The U.S. Securities and Exchange Commission advanced plans to extend traditional securities trading into overnight hours, holding a Thursday roundtable at its Washington headquarters just one hour after issuing an order approving tokenized securities trading.
Chairman Paul Atkins told the gathering of securities lawyers that the industry is entering a new cycle. "We're moving of course to a new day — and night," Atkins said, adding that tradeable events are no longer constrained to market hours and that expanded hours would allow investors to react more quickly to developments.
Atkins linked the push for longer hours to the agency's recent tokenization order, which grants firms a five-year exemption from certain securities regulations as they build tokenized trading platforms. He argued that tokenization could enable real-time inventory management, reduce settlement failures, and mitigate — potentially eliminate — abusive naked short selling.
"I've asked the staff to consider what steps can be taken to dovetail a growth-friendly environment with protections against harmful market behavior," Atkins said.
Several commissioners acknowledged the operational challenges of moving beyond the traditional weekday daytime session. Commissioner Hester Peirce noted that crypto markets "certainly don't sleep" and warned that firms fear wider spreads, increased volatility, reduced time to address technology issues, and weaker monitoring during overnight hours.
"These concerns are the real consequences of extending trading into hours when human involvement is limited," Peirce said. She added that companies also worry about overnight disruptions such as social media rumors driving stock prices down while corporate offices are closed.
Atkins said several preparations are already underway or in place to support the expansion, though he offered no specific timeline for implementation.
