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Have you ever wondered why stock trading takes a number of days to resolve? Have you ever had a nightmare about UX, which is a small ownership and thought? How is this still the norm in the world? And why should your stock live within a custody black box?
These design failures are summarised in the fact that the US stock market is fundamentally outdated. It is trapped within legacy infrastructure, bound by intermediaries, and possibly coded in COBOL.
Efforts to modernize systems are usually at the surface level. You may get faster messaging or slightly updated interfaces, but the core doesn’t seem to be touched at all times. Therefore, we live in a pattern of retention of a retarded settlement, bloating fees, as opaque as it is exclusive.
Enter Project Open, a newly submitted SEC pilot proposal, Blockchain, is at the core. Jointly proposed by the Solana Policy Institute, Superstate and Orca (with legal support from Lowenstein Sandler), Project Open is a request for exemption relief that allows the company to issue, register and trade stock securities on public blockchain networks like Solana.
Launched at the end of March, the Solana Policy Institute is a nonpartisan advocacy group aimed at helping policymakers understand the role public blockchain can play in economic and social infrastructure. Project Open is the first major public action.
This week, the group submitted a 20-page legal framework to the SEC’s Cryptographic Task Force, featuring the roles of registration pathways, KYC onboarding, smart contract-based payments, investor education modules and blockchain native transfer agents.
The publisher will submit a traditional style statement, which is the same as how we do what we do now. The main difference is that we use digital token classes instead of paper sharing. Transactions resolve immediately, from wallet to wallet to on-chain.
Project Open is committed to compliance head-on, proposing a gated publisher cohort, a pilot program with a 18-month period, with SEC monitoring burned.
Investors will hold “token stocks” on the whitelist after passing KYC and educational onboarding. Registered transfer agents have the ultra-admin rights to use the blockchain as a recording system to track all stocks, correct errors, recover assets, and enforce restrictions. There are no custodians. There is no net settlement. There is no ambiguity after the transaction. It’s just delicious, deterministic finality.
Project Open proposes trading on rails using smart contracts (In ORCA AMM or both side P2P swaps) rather than traditional exchanges. This filing outlines how tokenized trading mechanisms navigate existing rules such as Reg NMS and Broker-Dealer Custody requirements.
Frankly, this proposal will land on the right time for Gary Gensler to come out and carry back the enforcement action and new SEC Chair Paul Atkins, who signal openness to “great benefits” from blockchain infrastructure.
I’ve heard a similar song a lot recently. In an investor letter last month, BlackRock CEO Larry Fink clearly said:
“Every stock, every bond, every fund – every asset – can tokenize. If so, it will revolutionize investment. The market doesn’t have to close. Now, trading that takes days will become clear in seconds.
If he is right, the project opening may be the first serious attempt to give the US regulatory foundation in its future.
The goal is for the internet’s capital city to settle in seconds, run on open infrastructure and restore user-level control. Faster, fairer, cheaper, smarter, opaque dials thinn to nil.
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