Nasdaq proposes a legal framework for digital assets to the SEC, aiming to integrate crypto into the U.S. capital market, protect investors, and promote innovation.
The leading technology stock exchange Nasdaq has just submitted a comprehensive legal framework proposal to the U.S. Securities and Exchange Commission (SEC) to integrate digital assets into the existing financial system without impacting investor protection mechanisms.
In a letter sent on April 25 to Ms. Vanessa Countryman, SEC Secretary, Mr. John A. Zecca – Executive Vice President and Global Chief Legal, Risk, and Regulatory Officer of Nasdaq – emphasized the importance of establishing a clear asset classification system as a foundation for managing digital assets.
“A successful classification system needs to include clear categories and a management process that evolves as the industry develops,” Zecca asserted.
Four-tier classification system
Nasdaq's proposal establishes a classification system for digital assets into four groups: Financial Securities, Digital Asset Investment Contracts, Digital Asset Commodities, and Other Digital Assets. According to this proposal, financial securities, even when tokenized, will still adhere to traditional regulations.
“Whether existing in the form of paper stocks, digital stocks, or tokens, the fundamental nature of a financial instrument remains unchanged and needs to be regulated as before,” Zecca argued.
To balance innovation and investor protection, Nasdaq proposes the establishment of a specialized exchange model called “ATS-Digital” or “ATS-D.” This platform will facilitate the trading of digital commodities, investment contracts, and unclassified assets, under a lighter oversight framework while still ensuring transparency.
Nasdaq also calls for the establishment of a voluntary “safe harbor” mechanism for digital assets that do not fit any current classification. This mechanism allows trading based on the level of risk disclosures while regulators refine the classification process.
“Innovation must serve the interests of investors, not the other way around,” Zecca emphasized.
By recommending coordination between the SEC, the Commodity Futures Trading Commission (CFTC), and Congress, Nasdaq believes that the United States can build a dynamic digital asset environment while maintaining the integrity of the capital markets.