This version was previously published on Traders Magazine on 3/19/2026, which you can read here.

‍The CLARITY Act, designed to establish foundational rules for digital assets, intends to codify how these products are classified, which regulators oversee them, and how they are treated under U.S. law. Today, the bill is stalled over whether crypto companies can offer yield-bearing stablecoins.

This sticking point exposes the underlying issue driving the broader digital asset policy debate: who will be allowed to control and distribute digitally-native and tokenized securities as capital markets move on-chain – Wall Street or crypto?

‍Stablecoins originated as payments infrastructure. Yield – or interest payments derived from underlying U.S. Treasury holdings – changes that framing. Once a digital asset offers expected returns, it begins to resemble decades-old investment products governed by securities law. If a yield-bearing stablecoin is a security, most crypto or payments platforms are not authorized to issue, distribute, or manage it under current U.S. federal securities law.

This is why the stablecoin debate has become a policy flashpoint. It forces lawmakers to answer a difficult question: if digital assets offered through non-securities firms can generate investment returns, should they fall under the same rules that govern traditional securities products such as money market funds, stocks, bonds, or other yield-bearing instruments?

For much of the crypto industry, the answer seems to be no. For regulators and traditional financial institutions, the answer is a resounding yes.

This tension helps explain the timing of the U.S. Securities and Exchange Commission’s recent guidance re-affirming tokenization does not change the legal nature of an asset. Securities issued or transferred on blockchain rails remain securities – as many incumbent Wall Street firms also argued in January.

That debate, however, is not preventing markets from going digital. That transition is well underway, led by a handful of Wall Street’s largest firms.

Over the past two years, major asset managers have launched tokenized money market funds and on-chain Treasury products. Global banks have piloted tokenized deposits and on-chain settlement infrastructure. Market infrastructure providers are testing blockchain-based collateral mobility, repo settlement, and real-time clearing. Tokenized Treasuries alone have grown into a multi-billion-dollar on-chain market, while total real-world assets on public blockchains have crossed tens of billions of dollars.

More and more banks, broker-dealers, asset managers, and market infrastructure providers are investing heavily in digital asset businesses. The objective is not to recreate crypto markets, however. It’s to modernize securities markets, and Wall Street is moving from pilot to production.

That work is currently happening in two key ways: on-chain product development and traditional distribution.

On the product side, institutions are working with blockchain-enabled issuers to bring Treasuries, investment funds, private credit, and other instruments on-chain. $24 billion worth already sits on-chain. On the distribution side, they are building broker-dealer-led custody, settlement, and clearing infrastructure designed to distribute these assets through traditional channels such as brokerage accounts and institutional trading platforms.

This is how markets historically scale. New asset classes succeed when they are paired with trusted distribution and institutional-grade infrastructure.

Crypto platforms established direct-to-consumer trading ecosystems and captured significant market share while traditional financial institutions remained cautious. That dynamic is now reversing. As securities move on-chain, Wall Street is building digital asset strategies designed to integrate blockchain infrastructure directly into existing capital market rails — allowing digital assets to be offered alongside traditional investment products.

The resolution of the yield-bearing stablecoin debate will not determine whether digital markets emerge. That is happening. What it will determine is whether crypto platforms can evolve into full-service securities intermediaries without adopting the regulatory obligations that have historically governed that role.

Meanwhile, the securities industry is moving forward—building digital asset businesses through on-chain product development and traditional distribution channels.

By 2027, securities issuance, trading, and settlement on blockchain rails will likely scale faster than most current projections. The only remaining question is who will control the infrastructure, distribution, and investor access points that define digital securities markets.

Aaron Kaplan is the co-CEO of Prometheum Inc., a market infrastructure provider for digital assets supporting the issuance, trading, and clearance, settlement, and custody of tokenized securities, digitally-native securities, and crypto.

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