“The master securityholder file used to be paper in a filing cabinet,” said Joris Delanoue, CEO of SEC-registered onchain transfer agent Fairmint. “Today it is a database. The proposal recognizes that blockchain can be that database, not merely a copy of it.”
Why it matters
Today, many tokenized securities effectively run on two records: the onchain token ledger and the official shareholder register.
If the proposal is passed, blockchain can serve as the authoritative register, issuers and transfer agents may no longer need to maintain duplicate records and reconcile them after every transfer.
That could reduce operational friction and the risk of the onchain record saying one thing while the legally recognized ownership record says something else.
Eli Cohen, chief legal officer of fund tokenization specialist Centrifuge, said the proposal could turn today’s two-ledger setup into “a one-step process,” with the blockchain itself serving as the master security file.
This is important because the current “two-step” setup is more than just inefficient. It can create a major legal headache, particularly when something goes terribly wrong.
“If there was an insolvency or a bankruptcy, there would be just a mess,” Cohen said.
Transfer agents got some homework to do
There is a catch, however.
The proposal does not mean that tokenized securities become fully ‘permissionless’. The blockchain itself can remain open, Delanoue said, but the asset still has to follow the same rules on who can own it and how it can be transferred.