What happened
The SEC approved Paxos as a clearing agency authorized to provide central securities depository services on a blockchain ledger, the company confirmed in a statement Friday. Crypto. News first reported the approval.
Paxos, founded in 2012 and best known for issuing the USDP stablecoin and powering PayPal's PYUSD, is now registered to clear and settle securities transactions in the same regulatory tier as the Depository Trust & Clearing Corporation. The registration is the first of its kind granted to a firm built natively on blockchain infrastructure. Paxos described the decision as the culmination of a multi-year application process.
The company has been working with regulators on tokenized settlement designs since at least 2021, when it ran a pilot with Credit Suisse and Instinet to settle US-listed equities on its private chain in a single day, against the standard two-day cycle. The SEC has not yet published the formal order on its website.
Why it matters
This is a structural shift, not a marketing win. Clearing agency registration is the regulatory gate that has kept tokenized securities from settling at institutional scale in the US. Without a registered clearing agency in the loop, a tokenized stock or bond cannot legally settle for US investors.
Banks and brokers have been circling the tokenization theme for two years, but every serious proposal has run into the same wall: there was no SEC-blessed venue to actually clear the trade. Paxos just became that venue. The approval also signals where the SEC is heading under its current leadership.