Dinari Secures SEC Approval for Tokenized Stock Trading on Blockchain

Dinari, a San Francisco-based startup, has secured approval from the Securities and Exchange Commission (SEC) to operate as a stock broker using decentralized networks. This approval allows Dinari to launch its licensed tokenized stock trading platform in the next quarter, following the completion of its onboarding with the Financial Industry Regulatory Authority. Dinari is the first U.S. broker to trade tokenized equities on blockchain-like networks, a development that marks a substantial advancement in the integration of blockchain technology with traditional finance.

Under the new framework, Dinari will hold the actual stocks and issue dShares, which represent these positions. Investors will be able to trade dShares similarly to ordinary shares, but with faster settlements and lower fees. Additionally, trading will never pause since the networks operate continuously. This approach establishes a legal foundation for on-chain equity trading and secures regulatory approval in U.S. markets. Gabriel Otte, Dinari’s cofounder and CEO, emphasized that this achievement bridges the gap between Bitcoin’s network and traditional finance, noting that no other firm has reached this level of regulatory approval for tokenized equities.

Dinari will integrate its platform into third-party trading apps and desks, acting as a technology provider rather than offering direct retail services. This development comes as U.S. regulators show increasing support for crypto-based projects, creating a more favorable environment for startups like Dinari. Several market participants are already on board, though their names remain confidential. Investors will closely monitor whether dShares gain traction among brokers and asset managers. If successful, Dinari could introduce a new model for trading real-world assets by integrating blockchain networks with standard broker rules. This approach has the potential to lower costs and expedite settlements, offering a more efficient and seamless trading experience.

This event underscores the rapid evolution in regulated crypto offerings, broadening market access and potentially shifting industry benchmarks. Dinari, led by Gabriel Otte, has achieved a milestone by obtaining approval from the SEC to offer tokenized stock trading. This move positions Dinari to launch its platform for U.S. investors, expanding its reach. With the SEC approval, Dinari emerges at the forefront of regulated trading in the U.S. The company's focus will now include integrations with brokerages and fintech applications via APIs, shifting away from direct consumer interactions.

The announcement marks a notable shift in the market landscape, impacting both the crypto and traditional finance sectors. Competitors such as Coinbase and Kraken are yet to receive similar approvals, highlighting Dinari's pioneering status. The regulatory approval by the SEC sets a precedent, reflecting increased acceptance of digital assets in financial markets. Gabriel Otte, Co-founder and CEO, Dinari, stated, "For me, the end game is how can we elevate the entire financial system, which means not just a broker-dealer that’s on chain, but an exchange that’s on chain."

As Dinari and related entities continue to evolve, stakeholders may observe broader adoption of tokenized securities. Potential outcomes include expanded collaboration between traditional and crypto financial markets. Historical trends indicate an increasing support for tokenization in the U.S., potentially leading to new regulatory and investment strategies on global scales.