Paxos Securities Settlement Company received SEC clearing agency registration under Section 17A, becoming the first blockchain-native firm to achieve this status after seven years of engagement beginning with a 2019 no-action letter. A 2020 settlement pilot processed equity trades for AT&T and General Electric, demonstrating lower costs. The registration places Paxos inside the same regulated post-trade infrastructure layer as DTCC, which partnered with Stellar Development Foundation to tokenize Russell 1000 equities and US Treasuries in first half of 2027.
SEC clearing agency registration
- ▪Paxos Securities Settlement Company, LLC (PSSC) was granted registration as a clearing agency by the U.S. Securities and Exchange Commission under Section 17A of the Securities Exchange Act of 1934
- ▪The SEC designated May 3, 2026, as the deadline for the Commission to grant or deny PSSC's application in a Federal Register notice published in February 2026
- ▪Paxos Securities Settlement Company is the only blockchain-native firm registered to provide clearing and settlement services as a central securities depository in the United States
- ▪Paxos Securities Settlement Company became the first blockchain-native firm registered as a clearing agency under SEC Section 17A
- ▪The SEC registration of Paxos Securities Settlement Company is described as temporary in the SEC's order
- ▪Paxos announced on May 29, 2026, that Paxos Securities Settlement Company, LLC received SEC clearing agency registration
Seven-year regulatory pathway
- ▪Paxos Securities Settlement Company's clearing agency registration is the result of seven years of engagement with the SEC, beginning with a 2019 No-Action Letter
- ▪The 2020 Paxos settlement pilot demonstrated lower costs and operational efficiency within an SEC-supervised framework
- ▪Paxos conducted a 2020 settlement pilot that processed equity trades for AT&T and General Electric
Blockchain settlement infrastructure
- ▪Paxos Securities Settlement Company as a registered CSD can hold and settle traditional securities trades directly on blockchain rails, providing same-day or near-instant settlement for eligible securities
- ▪Paxos Securities Settlement Company's clearing agency registration places Paxos inside the same regulated post-trade infrastructure layer as the Depository Trust & Clearing Corporation (DTCC)
- ▪The Paxos Securities Settlement Company registration allows institutional participation at scale in blockchain-based settlement
Competitive tokenization landscape
- ▪Nasdaq and NYSE are operating tokenized equity trading under DTC's three-year tokenization pilot
- ▪The SEC's planned innovation exemption for tokenized stocks has been delayed amid concerns about third-party synthetic tokens
- ▪DTCC announced a partnership with the Stellar Development Foundation to tokenize DTC-custodied assets, including Russell 1000 equities and US Treasuries, on Stellar's public blockchain in the first half of 2027
- ▪Nasdaq won SEC approval for tokenized equity trading in March 2026
Paxos regulatory footprint
- ▪Paxos is prudentially regulated by the MAS in Singapore
- ▪Paxos is prudentially regulated by the OCC in the United States
- ▪Paxos partners with PayPal, Interactive Brokers, Mastercard, and Mercado Libre
- ▪Paxos is prudentially regulated by FIN-FSA in Europe
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