SEC proposes broad update to decades-old transfer agent rules with blockchain nod

The US Securities and Exchange Commission (SEC) has proposed overhauling decades-old rules governing transfer agents as blockchain-based recordkeeping and tokenized securities become more prominent in US markets.The proposal would update requirements covering registration, recordkeeping, safeguarding and securities transfers, while introducing new rules aimed at risks emerging from increasingly digital and automated market infrastructure.“Market participants are actively seeking to bring blockchain-native, or ‘onchain’ transfer agents into the U.S. market,” the SEC said, pointing to models for blockchain-based recordkeeping, tokenized fund administration and cross-chain interoperability.The agency said its existing framework does not adequately address those developments, particularly risks involving cybersecurity, operational resilience and the safeguarding of securities and investor records.Under the proposal, transfer agents would face expanded reporting requirements and new compliance standards, including rules governing restrictive legends on securities and the use of third-party service providers.SEC’s proposed Transfer Agent Rules. Source: SECThe SEC said its transfer agent ...