Argentina Pioneers Stock Tokenization Under Regulatory Sandbox

The national securities watchdog, the CNV, passed a resolution expanding the existing tokenization regime to include the digitalization of national and foreign stocks in Argentina, pioneering the official use of the technology in Latin America.

Argentina Implements Tokenization to Include Stocks in New Securities Regime

Several countries are rushing to incorporate digital assets into their financial systems as a means of modernizing and simplifying operations for their users. On Wednesday, the securities watchdog institution in Argentina, the CNV, passed a new resolution that opens a new chapter in the implementation of decentralized technology in securities trading.

General Resolution 1081 establishes that national and foreign stocks, alongside other securities like financial trusts and shares in closed-end mutual funds, can now be issued using decentralized technologies as tokens, following the framework that was subject to public discussion in April.

According to the new ruleset, these assets can now be issued, liquidated, and traded using decentralized platforms like blockchain, securing legal recognition from public and private institutions.

According to the resolution, the tokenization of shares will not involve new issuances, but will be implemented as an additional representation of already existing assets. Virtual asset service providers (VASPs) will act as depositaries of these securities, functioning as trading centers and implementing anti-money laundering (AML) compliance measures.

Finally, the resolution establishes that this functionality will be part of a regulatory sandbox that will be extended until August 21. This termination date can change depending on the results observed.

Roberto E. Silva, President of the CNV, highlighted the relevance of this trailblazing move, stating that they were “proud to present the second part of the tokenization regulation, with which we complete an innovative and pioneering regime for Argentina and the region.”

Furthermore, Silva stated that this new sandbox puts Argentina at the forefront of the regulatory processes in the region and the world, noting that the institution had worked hard to reach this milestone in the history of the capital market in the country.

Read more: Argentine Securities Regulator Launches Innovative Tokenization Framework