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Hyperliquid Strategies(NASDAQ:PURR) jumped 8% Thursday after the SEC approved the Innovation Exemption, a temporary order allowing tokenized stock trading on-chain for the first time.
What the SEC Actually Did
The SEC announced Thursday that it issued the Innovation Exemption, granting temporary relief to Tokenized Securities Venues to trade tokenized U.S. stocks on public blockchains using automated market makers.
The exemption also covers liquidity providers in those pools from the dealer definition under securities law.
“Today, the SEC is taking a significant step forward to bring America’s capital markets into the digital age,” SEC Chairman Paul Atkins said in a statement.
The exemption runs five years and carries strict conditions:
- TSVs must verify tokenized stocks carry the same rights as traditional shares, including dividends and voting rights
- Smart contracts must be auditable, public, and deployed on permissionless blockchains
- Issuers can object and block their stock from trading on a TSV
- Trading halts on the primary exchange automatically halt the tokenized version
- TSVs must be US persons and comply with OFAC sanctions
Why PURR Is Moving on This News
PURR climbed 8% Thursday, with the market reading the Innovation Exemption as directly bullish for Hyperliquid’s tokenization infrastructure play.
The SEC order requires trading on public permissionless blockchains with auditable smart contracts, which sits squarely in Hyperliquid’s lane as a decentralized exchange built for high-speed on-chain trading.
Atkins framed Thursday’s move as a direct response to the CLARITY Act’s Senate defeat earlier this week, saying the SEC is stepping in to move markets on-chain within its existing authority while Congress works on permanent legislation.
What This Means for the Tokenization Race
The Innovation Exemption is the clearest regulatory green light U.S. markets have seen for tokenized equities.
It gives venues a legal path to offer on-chain stock trading today, without waiting for Congress, while the SEC uses the five-year window to build a permanent framework based on what it observes in the market.
As Benzinga reported, Bernstein analysts expected the SEC and CFTC to move “aggressive and swift” on rulemaking after the CLARITY Act failed to advance. Thursday’s Innovation Exemption is the first concrete proof that prediction is playing out.
Key levels for PURR:
- $14.14 — August high, key target above
- $11.09 — 20-day EMA, must hold as support
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Source: www.benzinga.com