The U.S. Securities and Exchange Commission has proposed rescinding two core National Market System (NMS) rules, a move that could remove a substantial legal barrier to tokenized US stocks trading in decentralized finance (DeFi). The proposal targets Rule 611, which bans trade-throughs across exchanges, and Rule 610(e), which restricts displaying bids at the same or higher prices elsewhere. If adopted, the change would ease the path for tokenized equities to operate more freely within crypto trading venues.

The SEC said the changes would be considered as part of its ongoing effort to modernize the framework governing digital assets in U.S. markets. The agency opened a 60-day window for public comment on the proposal and will review responses before finalizing any rulemaking. The move follows the SEC’s broader emphasis on integrating crypto and blockchain technologies into existing market structures while safeguarding investors.

Key takeaways

• The SEC proposes scrapping NMS Rules 611 and 610(e), removing trade-through and bid-display constraints that currently apply to U.S. equities trading across exchanges.
• industry observers argue the change could unlock tokenized US stocks on DeFi platforms by eliminating a major regulatory hurdle that has constrained automated markets and cross-venue execution.
• Automated market makers (AMMs) in crypto face inherent alignment challenges with trade-through rules, as they execute at pool prices and cannot always stop a trade when a better quote exists elsewhere.
• Sources expect the SEC to replace the rules with a new best-execution framework, potentially allowing AMMs to operate under the updated regime.
• The proposal arrives amid broader regulatory activity around tokenized assets, including ongoing work under the SEC’s Project Crypto and prior discussions about tokenized stock trading plans.

Unlocking tokenized stocks: what the proposal changes

Industry participants have long argued that traditional guardrails—designed for a world of centralized venues—limit the efficiency and reach of tokenized equity trading. By rescinding Rule 611, which prevents a stock order on one exchange from trading at a worse price than on another venue, the SEC would remove a structural constraint that can hinder cross-platform arbitrage and execution quality. Likewise, eliminating Rule 610(e)’s bid-display prohibition could reduce the friction in displaying competitive quotes across multiple venues.

Galaxy Digital’s head of research, Alex Thorn, framed the potential shift as a major unlocking for tokenized stocks. “One of the biggest unlocks yet for tokenized stocks,” Thorn said, would come from removing a central barrier to trading alternatives on DeFi platforms. Thorn’s assessment highlights how the current rules interact with tokenized equities, where on-chain trading mechanisms operate with price discovery pooled from multiple sources rather than a single centralized order book.

Thorn emphasized that automated market makers (AMMs)—which pool assets to facilitate trades—would struggle under the existing regime, because their execution depends on pool prices rather than a single, live external quote. “AMMs can’t comply with trade-through rules as they are designed today; they ‘trade against whatever the pool price is,’” Thorn explained. He added that an AMM would also struggle to halt a trade if a better quote existed elsewhere, effectively risking constant violation of trade-through protections and potentially categorizing a tokenized stock pool as an illegal trading center under the current framework.

The SEC’s move is not happening in a vacuum. It comes as the agency has signaled a broader push to adapt regulatory structures to digital assets. Earlier coverage noted the SEC’s strategic emphasis on digital assets through 2030, and the agency has been weighing how to balance innovation with investor protection in this evolving space. The current proposal explicitly invites public input during the 60-day comment period, signaling that the agency may refine its approach in response to feedback from industry participants and other stakeholders.

As part of its broader policy arc, the SEC’s work intersects with ongoing discussions about tokenized stock trading plans. Reports from last month indicated the commission was considering a plan to allow tokenized stock trading but postponed release after exchanges raised concerns about execution and implementation. The new proposal could be seen as an alternative pathway toward enabling tokenized equities within a regulated framework, subject to stakeholder input and potential structural adjustments.

For readers tracking the regulatory backdrop, the SEC’s efforts should be viewed alongside ongoing explorations into how best to regulate digital assets while preserving market integrity and investor confidence. In parallel with the rules review, the agency’s broader strategy—often framed under headings like “Project Crypto”—reflects a desire to bring digital-asset activities into closer alignment with traditional market infrastructure where appropriate.

Context and what to watch next

The 60-day comment window is a crucial period for market participants, exchanges, token issuers, and developers building tokenized stock products. Revisions to the proposal could alter the shape of best-execution obligations, potentially adding clarity or constraints that affect how tokenized equities are traded in DeFi environments. Observers will be paying attention to whether the SEC settles on a formal best-execution framework as a successor to the rescinded rules and how that framework would accommodate AMMs and other automated trading mechanisms.

Related coverage confirms that the SEC’s digital-asset agenda has faced practical execution challenges, including discussions about how tokenized stocks will be integrated into regulated markets and the concerns raised by traditional exchanges about how such products would operate. Those discussions underscore the balance regulators seek between enabling innovative access to markets and maintaining protections for investors.

Readers should watch for the agency’s response to public input and any subsequent rulemaking steps. If the best-execution approach is adopted, it could mark a meaningful turning point for the alignment of on-chain trading with established market protections, potentially accelerating the deployment of tokenized stock trading platforms within a regulated ecosystem.

Source: Alex Thorn, Galaxy Digital; coverage of SEC initiatives and tokenized stock discussions referenced in ongoing reporting on Project Crypto and related regulatory developments.

Can Robinhood or Kraken’s tokenized stock offerings ever be truly decentralized? Industry debates continue as regulators weigh how to apply traditional market protections to innovative digital-asset trading formats. For now, the SEC’s latest proposal stands as a meaningful signal that the regulatory landscape for tokenized securities could be reshaped in the coming months, with implications for traders, issuers, and developers building in the tokenized-stocks space.

Key Highlights

• The $H token plummeted 80-90% following a security breach on June 8-9, erasing over $1 billion in market capitalization
• Malware on a developer’s computer compromised private keys, enabling hackers to steal 141M tokens and create 200M additional ones
• Immediate financial damage is calculated between $30M–$36M; $H dropped to $0.05–$0.13 before recovering to approximately $0.20
• Officials suspended bridge operations, announced a $1M USDT reward, and committed recovered assets to token repurchase initiatives
• Speculation about internal complicity has emerged among researchers, with an upcoming token release on June 25 intensifying concerns

Humanity Protocol’s $H token stood out as a top-performing cryptocurrency in early 2026, delivering returns between 300–800% and climbing to a record peak of $0.8439 on June 2. Yet within mere days, more than 80% of that value evaporated.

A cybersecurity incident on June 8–9 sparked the dramatic downturn. The digital asset plunged from approximately $0.67–$0.74 to depths of $0.05–$0.13. More than $1 billion in valuation disappeared within hours.

Following the crash, $H has mounted a 41% recovery and was changing hands near $0.20 as of June 10–11. The token still shows approximately 74% losses over the seven-day period.

Anatomy of the Security Breach

The vulnerability originated from an infected developer computer. Malicious software on this machine revealed private keys that controlled Humanity Protocol’s Gnosis Safe infrastructure on both Ethereum and BNB Chain.

This wasn’t a sophisticated smart contract vulnerability or an intricate DeFi protocol manipulation. It represented a fundamental operational security breakdown.

On the Ethereum network, three out of six Gnosis Safe keys were compromised. Attackers leveraged these credentials to extract approximately 141.2 million $H tokens through a single transfer.

On BNB Smart Chain, three out of five authorization keys fell into hostile hands. The perpetrators activated unrestricted minting capabilities and generated over 200 million new $H tokens through two separate operations.

Both the stolen and newly fabricated tokens flooded exchanges, destroying price stability and sparking widespread panic selling. The immediate monetary impact from extracted and manufactured tokens ranges from $30 million to $36 million.

Official Actions and Outstanding Concerns

Humanity Protocol responded swiftly following the compromise. Officials verified the incident stemmed from key exposure rather than code vulnerabilities, and immediately suspended all bridging functionality.

They deployed a public monitoring system displaying attacker addresses and transaction flows. A $1 million USDT reward was established for intelligence contributing to fund retrieval.

The organization also pledged that any reclaimed assets would support market purchases of $H tokens. No specific schedule for this buyback initiative has been revealed.

Blockchain investigator ZachXBT and fellow analysts have started reviewing transaction sequences surrounding the incident. Several researchers have floated theories regarding possible internal coordination.

The chronology has attracted attention. A planned token distribution was scheduled for June 25, approximately fourteen days following the security failure. Certain commentators have theorized the breach might represent a coordinated withdrawal ahead of that release.

Market Outlook and Community Focus

The rebound from $0.05–$0.13 to roughly $0.20–$0.21 indicates renewed purchasing interest. However, the asset remains 70–75% beneath pre-attack valuations, with transaction volumes notably subdued.

Limited market depth suggests the current uptick could reverse abruptly. The approaching June 25 distribution compounds existing uncertainty within an already shaken investor base.

Humanity Protocol manages sensitive biometric verification systems, making security lapses particularly destructive to credibility. Critical questions surrounding key custody protocols and potential insider participation await resolution.

The platform’s forthcoming actions — including potential asset recovery and the impact of the June 25 distribution — will likely determine whether this price recovery maintains momentum.

South Korea’s tax authorities are preparing to treat tokenized stocks as securities rather than virtual assets, a move that could bring the rapidly growing sector into the country’s existing taxation framework once financial regulators finalize their legal interpretation.

According to comments from South Korea’s Ministry of Economy and Finance shared with local outlet Bloomberg Bit, the government currently views tokenized stocks as securities in substance despite their blockchain-based structure. 

The ministry said that if the Financial Services Commission determines tokenized stocks qualify as securities, taxation could begin immediately under existing capital markets rules without requiring new legislation.

Officials told the publication that tokenized equities may take the form of digital assets, but their economic characteristics more closely resemble traditional securities. 

The ministry also pointed to previous guidance from financial regulators, which emphasized that assets meeting the characteristics of securities should be regulated as securities regardless of the technology used to issue them.

Interest in tokenized equities has grown rapidly over the past year as investors seek blockchain-based access to publicly traded companies. 

Data from RWA.xyz showed the tokenized stock market reached $1.47 billion as of June 8, up 115% since the start of the year.

Tokenized stock market value. Source: RWA.XYZ

Demand has been particularly strong among investors seeking exposure to U.S. companies such as Tesla and Nvidia through platforms that offer around-the-clock trading and faster settlement.

Financial regulators move toward legal clarification

Attention is now turning to the Financial Services Commission, which is expected to release revisions to its token securities guidelines and related regulations in July.

Earlier, during the second meeting of a public-private token securities task force in May, the commission said it would develop a detailed roadmap for the tokenization of conventional securities, including listed stocks. 

A formal interpretation classifying tokenized shares as securities could clear the way for tax collection during the second half of 2026.

South Korean regulators have already established a foundation for that approach. In its 2023 token securities guidelines, the commission stated that token securities issued in digital asset form fall under the scope of the Capital Markets Act. 

However, those guidelines focused largely on fractional ownership products tied to assets such as real estate, artworks, and intellectual property, leaving uncertainty around tokenized versions of ordinary shares.

Because of that uncertainty, many market participants had assumed tokenized stocks would be treated similarly to virtual assets and remain outside the tax net until South Korea’s virtual asset taxation regime takes effect next year.

Overseas trades could also fall under tax rules

The Ministry of Economy and Finance indicated that taxation would not necessarily be limited to domestically issued products.

Officials told Bloomberg Bit that securities taxation under existing law is based on the economic rights attached to an asset rather than where it is issued. 

As a result, tokenized stock transactions conducted through overseas platforms could still be subject to South Korean tax rules if the underlying rights are deemed equivalent to securities.

The ministry also noted that future classifications may depend on specific features attached to the tokens. Depending on whether voting rights are included, tokenized stocks could potentially be categorized as ordinary shares, derivative-linked securities, or investment contract securities.

At the same time, South Korea’s tax authorities and the National Tax Service are working to strengthen information-sharing arrangements with foreign tax agencies, including the U.S. Internal Revenue Service, to improve visibility into transactions conducted through overseas platforms.

The regulatory push comes as tokenized finance gains momentum globally. 

According to a Binance Research report, tokenized stocks had become the fastest-growing segment of the real-world asset sector, with market value rising 422% since early 2025. 

The research firm attributed much of the growth to platforms that provide blockchain-based access to traditional equities and exchange-traded funds.

Growing activity on platforms such as xStocks and Ondo Global Markets has further accelerated investor interest in blockchain-based securities, increasing pressure on regulators to clarify how existing financial and tax laws should apply to the sector.

Bitcoin and Ether options worth about $2.5 billion expire on June 12, putting the $60,000 to $62,000 Bitcoin range back in focus.

Around 35,000 Bitcoin options contracts expire today, with a notional value near $2.23 billion. The event is slightly larger than last week’s expiry, but still smaller than major monthly or quarterly expiries.

The current Bitcoin options batch has a put/call ratio near 0.66 to 0.68. Deribit data also placed Bitcoin’s max pain level around $66,000 to $67,000, above the current spot price near $63,000.

Max pain is the price where the largest number of options contracts expire worthless. When spot price sits far below that level, many bullish contracts lose value at expiry.

The event comes as crypto markets remain weak after a difficult week. Bitcoin has bounced slightly, but broader selling pressure remains visible across spot and derivatives markets.

Bitcoin $60K to $62K zone stays in focus

GreeksLive said Bitcoin options positioning has tightened around a narrow set of strike prices. The firm pointed to the $60,000 to $62,000 region as the main downside zone for traders.

“The largest short dealer exposure anchored is at $60K. Collectively, downside exposure is heavily concentrated within the $60K to $62K range,” GreeksLive said.

That range matters because it sits close to Bitcoin’s current support area. If BTC falls back into that band, dealer hedging and stop orders could increase short-term volatility.

Deribit also said positioning remains call-heavy despite recent market stress. That shows many traders still hold upside exposure, even as spot markets stay under pressure.

“Despite recent volatility, positioning remains skewed toward calls across both assets,” Deribit said.

Ether options add to expiry total

Ether options also expire today, adding about $293 million in notional value. Around 175,000 ETH contracts are set to expire, with max pain near $1,750.

ETH traded close to $1,650, staying below its max pain level. The token has struggled to recover after losing higher support zones during the latest crypto selloff.

The Ether options put/call ratio stood near 0.58 to 0.62, showing more call exposure than put exposure. Still, spot ETH has not shown a strong rebound yet.

The total crypto options expiry stands near $2.5 billion. That makes today’s event notable, but not large enough by itself to change the wider market trend.

Spot market remains weak

Bitcoin traded near $62,937, while Ethereum traded near $1,656, according to crypto.news market data. BTC held above the $60,000 area, while ETH stayed close to its lower support range.

Total crypto market value remains near multi-month lows after heavy selling earlier in June. The latest bounce has slowed the decline, but buyers have not yet shown strong control.

As previously reported by crypto.news, crypto spot volume fell to $679 billion in April as retail demand weakened. That report showed that the market is not only facing sellers, but also a shortage of active buyers.

SpaceX’s planned IPO has also raised questions about capital rotation from crypto into major technology listings, as previously reported. That pressure sits alongside geopolitical risk, inflation concerns, and weaker risk appetite.

For Bitcoin, the key level remains the $60,000 to $62,000 range. A clean hold above that zone could limit expiry-related pressure, while a break lower may bring the mid-$50,000 area back into discussion.

An international law enforcement operation among 11 countries has shut down AudiA6, a money laundering ring that processed over 336 million euros ($390 million) in illicit funds between 2022 and 2025.

On Wednesday, authorities arrested two administrators, Russian and Ukrainian nationals, in Georgia, seized 25 domains and more than 30 servers and 80 vehicles and froze roughly $900,000 in cryptocurrency, the European Union Agency for Criminal Justice Cooperation (Eurojust) said Thursday.

The AudiA6 “mixer-as-a-service” was used by cybercriminals involved in ransomware attacks to cash out stolen crypto and conceal the movement of illicit funds from authorities by offering to “clean” crypto within about an hour for a 3% to 10% commission.

Since 2021, AudiA6 wallets received approximately 10,333 BTC, valued at around $389 million at the time the transactions occurred, Chainalysis reported. 

The cybercrime syndicate behind the service is also reportedly running a separate marketplace forum known as “Dark2Web”, which is used to advertise illicit services and connect cybercriminals worldwide, according to Eurojust. 

The investigation involved agencies from the United States, Australia, France, Poland, Georgia, Iceland, Canada, Germany, Japan, Switzerland and the United Kingdom, coordinated through Eurojust and Europol. 

Fake KYC accounts used in scheme

The crypto laundering ring was facilitated by thousands of fraudulent accounts using stolen or purchased identities. 

More than 6,000 Know Your Customer (KYC) records linked to “money mule accounts” were identified during the investigation, Eurojust said. 

Many of those accounts were connected to Russian-speaking intermediaries recruited specifically to help move criminal proceeds through crypto exchanges, it added. 

Related: Ransomware attacks surge 50% in 2025, ransom payments decline

AudiA6 also reportedly laundered part of a ransom paid by an Australian business in 2024 following a ransomware extortion attack, according to the Australian Federal Police, which was part of the investigation. 

Both the regular and dark web versions of AudiA6 and Dark2Web domains have been replaced with seizure banners.

A multinational law enforcement effort led to the closure of the platforms. Source: Europol

Ransomware consolidates around a few operators  

Ransomware was recorded in 97 countries during the first quarter of 2026, but the distribution of attacks is becoming increasingly concentrated, with the US accounting for 64.7% of all recorded victims, according to Emsisoft. 

“The ransomware ecosystem is once again consolidating around fewer, more dominant operators,” with the top 10 ransomware groups accounting for 71% of all Q1 2026 victims, reported Check Point Research in May. 

Magazine: Does ‘Paper Bitcoin’ mean there’s an unlimited supply of BTC?

TLDR:

• Michael Selig solely runs the CFTC, gaining unmatched power over crypto markets.
• CFTC approved crypto perpetual futures, triggering CME Group’s stock decline and criticism.
• Lawmakers from both parties push Trump to nominate additional CFTC commissioners.
• Staff buyouts and unrest grow as CFTC’s crypto oversight role expands rapidly.

CFTC Chair Michael Selig is consolidating regulatory control over crypto and prediction markets, drawing both industry praise and rising concern in Washington.

As the agency’s sole commissioner, Selig now holds outsized influence over digital assets, derivatives, and platforms like Kalshi and Polymarket.

Solo Chair Reshapes CFTC Agenda

Selig has served less than six months as CFTC chair, yet his impact is already substantial. He operates as the only sitting member of what should be a five-person bipartisan commission.

This unusual arrangement gives him unilateral authority over crypto products, prediction markets, and oil futures.

His approach favors faster approvals and lighter enforcement than his predecessors. Selig recently approved crypto perpetual futures, a first for U.S. markets. These products let traders bet indefinitely on asset prices without expiration dates.

The approval rattled CME Group, whose stock dropped after the decision. Speaking on CNBC, CME CEO Terry Duffy warned that the move “could be a disaster waiting to happen.” Despite the pushback, the CFTC defended the decision as part of bringing offshore activity onshore.

Selig also backed the Winklevoss twins in their effort to vacate a Biden-era settlement. The CFTC released internal documents tied to the case, unsettling some staff members.

Commenting on the disclosures, attorney Jack Baughman, who represented Gemini, said “this sort of information should be made available in every case, in my view.”

Lawmakers from both parties are now urging Trump to nominate additional commissioners. Senate Agriculture Chair John Boozman and House Agriculture Chair GT Thompson back this push.

Sen. Elissa Slotkin voiced her own concern, stating bluntly, “We’ve got one guy who has clear leanings toward the industry. I’ve got a problem with that.”

Staff Unrest Grows Amid Crypto Bill Push

Internal tension at the CFTC has intensified alongside Selig’s expanding influence. A current official described the agency as lacking the operational capacity to oversee crypto.

CFTC spokesperson Brooke Nethercott rejected that characterization, calling it “a despicable description of our dedicated civil servants.”

A fresh round of buyout offers has hit the Division of Market Oversight particularly hard. This division traditionally handles derivatives exchange oversight and trading venue rules.

Reflecting on the broader pattern, one former official summarized the mood simply: “It’s death by a thousand cuts.”

Notably, a recent prediction market rule proposal bypassed this division entirely. Instead, the general counsel’s office led the drafting process this time.

Nethercott pushed back on suggestions of dysfunction, saying it would be false to “imply anything in the CFTC is done in a vacuum.”

Congress is weighing a digital assets bill that would formally expand CFTC authority. This legislation could make Selig a central regulator for the $2 trillion crypto market. Companies ranging from Coinbase to World Liberty Financial would fall under this oversight.

Former CFTC chair Timothy Massad criticized the agency’s current trajectory sharply, comparing it to a once-reliable engine now running off the rails. Still, industry voices like Chris Perkins remain enthusiastic, declaring of Selig’s approach, “He’s doing God’s work.”

Crypto traders, having seen bitcoin BTC$62,895.02, the largest cryptocurrency, bounce overnight to $64,000 from recent lows under $60,000, may be wondering whether the bottom has been hit and a fresh bull run has started.

There is a simple signal to get that confirmation. Right now, it is saying the rebound has not started.

That signal comes from the widely followed momentum gauge called the relative strength index, or RSI. The measure can range from 0 to 100. Readings above 70 indicate that an asset is running hot and potentially overbought, while readings below 30 suggest the opposite. Between those extremes, specific levels often emerge as dividing lines between bullish and bearish environments.

For the bitcoin price, the line is at 41.5, according to crypto data analytics platform Material Indicators. Above that level, BTC has historically had a stronger argument for being in a bullish macro trend. Below it, bearish pressure tends to dominate.

“Right now, Bitcoin is below it, and still trending down,” Keith Alan, an analyst at Material Indicators, said in an email. “That does not mean price has to collapse, but it does mean the burden of proof is still on the bulls.”

Federated Hermes has launched a new money market fund designed for stablecoin reserve management, introducing a product that can be used by payment stablecoin issuers operating under the GENIUS Act framework.

According to a July 10 announcement, the newly introduced Federated Hermes Money Market Management Digital Treasury Fund, trading under the ticker OFFXX, has been structured to meet the reserve asset requirements that payment stablecoin issuers must maintain under the Guiding and Establishing National Innovation for U.S. Stablecoins Act, or GENIUS Act.

The launch comes as the stablecoin industry moves deeper into the implementation phase of the GENIUS Act, which established a federal framework for payment stablecoins in July 2025 and requires issuers to maintain 1:1 backing with high quality liquid assets.

Under details released by Federated Hermes, the fund seeks to generate income while preserving principal stability through investments in U.S. dollar cash, U.S. Treasury securities with maturities of 93 days or less, and overnight repurchase agreements backed entirely by Treasury securities.

The company said the fund intends to operate in compliance with Rule 2a-7 of the Investment Company Act of 1940, the regulatory framework that governs money market funds.

While the Reserve Shares themselves do not use blockchain technology, Federated Hermes said the product has been created primarily for participants in the digital asset sector. The shares can be purchased and held by individuals, institutional investors, and payment stablecoin issuers either directly or through intermediaries.

In some cases, those intermediaries may use blockchain systems to maintain ownership records for customers. Federated Hermes also said it could explore using blockchain technology to record ownership of Reserve Shares or future share classes.

Growing regulatory requirements are creating demand for reserve-focused products. Proposed rules issued by FinCEN and OFAC under the GENIUS Act would subject permitted payment stablecoin issuers to anti-money laundering and sanctions compliance obligations similar to those applied to other financial institutions, which cover customer verification, transaction monitoring, sanctions screening, and suspicious activity reporting.

Federated Hermes expands digital asset offering

Drawing on more than five decades of experience in liquidity management, Federated Hermes appointed Susan Hill, head of the firm’s government liquidity group, and senior portfolio manager John Wyda to oversee the fund.

As of March 31, 2026, Federated Hermes managed $684.7 billion in money market assets and $907.1 billion in total assets under management, according to company figures.

“Liquidity management is a core business of Federated Hermes and we offer one of the largest menus of targeted solutions,” said Paul A. Uhlman, president and chief executive officer of the Federated Advisory Companies.

“Federated Hermes is proud to advance strategic initiatives that bring together the strength of money market investments and our management expertise.”

He said the firm continues to evaluate opportunities tied to blockchain technology as interest in digital assets and tokenized money market products grows.

Federal agencies are still finalizing several GENIUS Act rules, with implementation deadlines continuing through 2026. As issuers prepare for reserve, compliance, and reporting obligations under the law, products built specifically around eligible reserve assets are beginning to enter the market.