Tokenisation Decision Made - Now Comes the Hard Part!

On 25 March 2026, the US House Financial Services Committee held what may prove to be a defining moment for the global tokenised securities industry.

In a hearing titled "Tokenisation and the Future of Securities: Modernising Our Capital Markets," committee members across both parties reached a striking bipartisan conclusion: tokenised securities are coming, and the existing regulatory framework does not adequately cover them.

What happens next in Washington will shape the global market - including the UK's own regulatory positioning.

The Hearing

The session was called against a backdrop of a $26.48 billion tokenised RWA market (at the time of the hearing), with BlackRock, JPMorgan, Franklin Templeton, and Circle all having deployed institutional-grade tokenised products at scale. The market had grown from a rounding error to a systemic consideration in under three years.

Committee Chairman French Hill used his opening statement to frame tokenisation not as a fintech story but as a capital markets infrastructure story — calling it a change to how securities "are issued, traded, and recorded" at a foundational level. That framing matters: it signals that lawmakers are treating this with the same seriousness as the 1975 Securities Acts Amendments, which created the National Market System.

The hearing centred on the CLARITY Act, which passed the House in July 2025 with a 294–134 bipartisan majority and is currently advancing through Senate Banking Committee markup, targeted for the second half of April 2026.

What the CLARITY Act Does

The CLARITY Act is designed to resolve the central regulatory ambiguity that has held back institutional tokenisation in the US: is a given tokenised asset a digital security (under SEC jurisdiction) or a digital commodity (under CFTC jurisdiction)?

The current patchwork — where that determination is made case by case, often through enforcement action — has been named by 66% of institutional investors as a reason not to invest in digital assets, according to a January 2026 EY-Parthenon and Coinbase survey.

The CLARITY Act would make that determination by statute, creating a defined framework that firms can build products around.

• Statutory criteria for distinguishing digital securities from digital commodities

• A unified registration framework for tokenised securities issuers

• Safe harbour provisions for companies in the process of transitioning to full compliance

• Interoperability requirements to ensure tokenised securities can settle across different blockchain networks

Why the Outcome Matters Beyond the US

The US accounts for the largest single pool of institutional capital globally. When US rules clarify which tokenised products are legal, compliant instruments, capital that has been sitting on the sidelines will begin moving. That capital will seek jurisdictions and platforms that are ready to receive it.

For UK founders tokenising equity, this creates both opportunity and urgency. The opportunity: well-structured UK tokenised securities that meet US standards could attract US institutional capital. The urgency: if the UK's own regulatory framework (the FCA's cryptoasset regime, expected from September 2026, and the emerging PISCES infrastructure for private companies) does not achieve mutual recognition or interoperability with US standards, UK issuers risk being locked out of the world's deepest capital pool.

The FCA and HM Treasury have been closely following the CLARITY Act proceedings. UK responses to the EU DLT Pilot Regime's early results, and to the March 2026 Congressional hearing, are expected to feature in the FCA's next consultation update on its tokenised securities framework.

The Open Questions

The hearing clarified the direction without resolving all the hard questions. Witnesses raised concerns that remain live issues:

• Custody: Who holds the underlying assets if the blockchain record diverges from legacy systems during a settlement failure?

• Investor protection: How do retail investor protections — prospectus requirements, cooling-off periods, know-your-customer obligations — apply to 24/7 on-chain secondary markets?

• Cross-border recognition: If a tokenised security is issued under Lise's French DLT framework, can it trade on a CLARITY Act-compliant US platform? The hearing did not answer this.

• Smart contract liability: If an automated smart contract executes a trade that violates a court order or sanctions requirement, who bears legal responsibility?

These are not merely academic questions. They are the questions that issuers, founders, and investors building tokenised equity structures will face when their products reach maturity.

Key Takeaways

• The US House Financial Services Committee held a landmark tokenisation hearing on 25 March 2026, with bipartisan consensus that tokenised securities are inevitable and current regulation is inadequate.

• The CLARITY Act — which passed the House 294–134 in July 2025 — is advancing through Senate markup in April 2026; it will define whether tokenised assets are SEC or CFTC instruments.

• 66% of institutional investors cited regulatory uncertainty as the primary reason to avoid digital asset investment (EY-Parthenon/Coinbase, January 2026).

• US regulatory clarity will unlock institutional capital that will flow to jurisdictions and platforms ready to receive it — putting pressure on UK regulators to accelerate.

• Key unresolved issues include custody liability, retail investor protections, cross-border recognition, and smart contract legal responsibility.