SEC to Reduce Wall Street Transparency as Public Blockchains Rise

The U.S. Securities and Exchange Commission is moving more slowly on some Wall Street transparency mandates just as public blockchains are giving institutions a new way to publish ownership and transaction data in near real time. The tension is visible in two places: delayed or narrowed SEC reporting regimes for traditional markets, and fast growth in tokenized U.S. Treasuries and onchain funds led by BlackRock, Franklin Templeton and other large issuers.

That contrast matters because the SEC has spent years arguing that more disclosure in securities lending, short selling and private funds would improve oversight and market confidence. At the same time, the agency’s own commissioners have acknowledged that tokenization can increase operational efficiency and transactional transparency when securities or fund interests move onto distributed ledgers. The result is a policy split-screen: less immediate visibility in parts of traditional finance, more machine-readable visibility on public chains.

March 2026 data shows a widening transparency gap

The clearest example on the traditional side is securities lending. In October 2023, the SEC adopted Rule 10c-1a to require reporting of securities-loan terms to a registered national securities association, with parts of that data intended for public release. The agency said the rule was designed to increase transparency in the securities lending market. Yet the implementation timeline was later pushed back, delaying when the market would actually see that information in production.

Private fund reporting followed a similar pattern. In February 2024, the SEC adopted amendments to Form PF that expanded the data large hedge fund and private equity advisers must report, including exposures, liquidity, financing and counterparty information. Those amendments were framed as a way to improve data quality and comparability, but compliance dates were later extended, slowing the arrival of richer reporting into the regulatory system.

Treasury-market reform also shows the trade-off. The SEC’s 2023 Treasury clearing rule was meant to reduce risk and increase transparency in the $26 trillion Treasury market. In February 2025, the commission extended key compliance dates by roughly one year, moving cash-market compliance to December 31, 2026 and repo compliance to June 30, 2027, according to SEC-linked implementation materials and market guidance.

Why tokenized funds are gaining ground with institutions

Public blockchains are not replacing SEC disclosure systems, but they are offering a different transparency model. Commissioner Hester Peirce said in May 2025 that tokenization may bring “transactional transparency,” faster settlement and greater accessibility to securities markets. She also stressed in separate remarks that tokenized securities remain securities, meaning blockchain rails do not remove existing legal obligations.

What has changed is scale. RWA.xyz data from March 12, 2026 showed BlackRock’s BUIDL at roughly $1.999 billion in total value, with Franklin Templeton’s BENJI around $1.0 billion. That places two of the largest asset managers in the U.S. among the most visible issuers in tokenized Treasuries, a category that did not have comparable size two years earlier.

The institutional case is straightforward: public chains can show token supply, wallet balances, transfer activity and settlement timing continuously, while traditional reporting often arrives in batches, with delays, and sometimes only to regulators. That does not mean onchain data is complete. Beneficial ownership can still sit behind omnibus structures, permissioned transfer controls or intermediated wallets. Even so, the base ledger is visible in a way many private-market systems are not.

How delayed SEC rules changed the comparison

The comparison is not that blockchains are fully transparent and Wall Street is opaque. It is that the SEC’s own transparency agenda in traditional markets is arriving more slowly than planned, while onchain finance is already publishing some market data by design.

Rule 10c-1a is a good example. The SEC adopted it to make securities-lending data more comprehensive, accurate and accessible. But the postponed reporting start means investors and analysts still do not have the full public feed the rule envisioned. Form PF is another case: the data expansion exists on paper, yet the compliance extensions delay the richer dataset regulators sought after the Archegos-era focus on hidden leverage and liquidity risk.

By comparison, tokenized Treasury products expose at least part of their market structure every day. Analysts can monitor issuance concentration, chain distribution and wallet activity without waiting for quarterly or monthly forms. That is one reason Coinbase Research argued in January 2026 that distributed real-world assets had become a structural theme, with regulation and institutional participation pushing tokenization deeper into existing financial perimeters.

Two paths now face the SEC as tokenization tests old reporting models

One path is convergence. The SEC could preserve traditional disclosure rules while creating narrower exemptions or tailored frameworks for tokenized securities, as Peirce indicated in March 2026 when discussing work on a “narrower” exemption for tokenized securities. In that scenario, blockchain-based products would sit inside securities law but use new settlement and recordkeeping rails.

The other path is fragmentation. If traditional transparency mandates keep slipping while tokenized products expand under bespoke relief, markets could end up with two disclosure standards: delayed reporting for legacy intermediated markets and continuous ledger visibility for selected onchain instruments.

For institutions, the commercial signal is already visible. BlackRock, Franklin Templeton and other issuers are no longer treating public blockchains as a branding exercise. They are using them for live Treasury and cash-management products. For regulators, that raises a harder question than whether tokenization is legal. The question is whether older reporting architecture still sets the transparency benchmark.

Frequently Asked Questions