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Crypto infrastructure firm Paxos has secured a rare position inside the US securities system after receiving clearing agency registration from the US Securities and Exchange Commission.
The approval allows Paxos Securities Settlement Company (PSSC) to provide clearing and settlement services for eligible securities in the United States. The company said it is now the first blockchain-native firm approved by the SEC to operate in that role.
The registration gives Paxos direct exposure to one of the most important layers of financial markets, i.e., the systems that finalize trades, move ownership records, and settle cash between buyers and sellers after a transaction is executed.
Paxos Moves Beyond Pilot Stage
SEC’s greenlight closes a process that started nearly seven years ago. Back in 2019, the SEC issued Paxos a no-action letter allowing the company to test blockchain-based settlement infrastructure under regulatory supervision.
Paxos officially launched the pilot in February 2020 and began processing US equity settlements with major financial institutions.
During the pilot period, Paxos worked with firms including Bank of America, Credit Suisse, and Société Générale to test blockchain-based post-trade settlement systems inside a regulated framework.
The company argued that blockchain infrastructure could reduce settlement delays, lower operational costs, and improve efficiency compared to traditional systems.
Under the current US market structure, equities typically settle on a T+1 basis, meaning final settlement happens one business day after the trade.
Paxos has been pushing same-day settlement as an alternative model, aiming to reduce counterparty risk and free up locked capital faster.
CEO and co-founder Charles Cascarilla said the SEC registration was the result of years of engagement with regulators and institutional market participants.
Why the Approval Matters
Clearing agencies sit between buyers and sellers during securities transactions. They verify trades, manage settlement, move assets, and reduce the risk of failed transactions.
In the United States, this layer has traditionally been dominated by legacy financial infrastructure providers such as the Depository Trust & Clearing Corporation.
Paxos entering the space gives banks, brokerages, and institutional trading firms a regulated blockchain-based alternative for settlement operations.
The approval also strengthens the broader push toward tokenized financial markets, where securities, stablecoins, and settlement systems increasingly move onto blockchain rails instead of traditional databases.
For traditional finance firms exploring tokenization, the registration removes one of the largest regulatory barriers to using blockchain infrastructure for real-world securities activity.
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