The SEC’s plan to replace Rule 611 could allow automated crypto market makers to trade tokenized equities without violating best-price rules.
The SEC proposed scrapping Rule 611, which requires trades to execute at the best available price across all markets. Automated market makers (AMMs) in crypto cannot comply with the current rule, as they execute orders at pool prices that may not reflect the best quote elsewhere, risking constant violations and potential legal exposure for tokenized stocks.
The agency’s 60-day comment period follows a delayed plan to permit tokenized stock trading, which was postponed after exchanges raised operational concerns. The SEC is considering a shift to a “best execution” framework, which could accommodate AMMs and reduce compliance risks for digital asset platforms.
No immediate market reaction was reported, but the proposal signals regulatory flexibility toward integrating tokenized assets into traditional equity markets.