Paxos Securities Settlement Company, LLC, a subsidiary of Paxos, has received formal registration from the U.S. Securities and Exchange Commission (SEC) to provide securities clearing and settlement services. According to the company, this makes it the first blockchain company approved in the U.S. to provide blockchain settlement infrastructure for traditional stocks, allowing it to enter the post-trade securities process, which has long been dominated by traditional institutions.

Same-day settlement available for eligible securities

This approval means that Paxos can use blockchain as a clearing and settlement channel to provide same-day or near-real-time settlement services for eligible securities. Compared to the traditional stock market, this model aims to shorten the time for funds and assets to settle after a transaction is completed, reducing the capital tied up by institutions while waiting for settlement.

The U.S. stock market transitioned to T+1 settlement in 2024, meaning settlement is completed on the next business day after the transaction. However, from execution to the final exchange of cash and securities ownership, it still mainly relies on a centralized clearing system, and the market has long been dominated by institutions such as the Depository Trust & Clearing Corporation (DTCC).

RWA tokenization infrastructure continues to advance.

Paxos stated that this approval completes a key step in its institutional-grade real-world asset tokenization strategy. The company already holds multiple licenses in the US, Europe, and Singapore, and provides white-label infrastructure services to clients such as PayPal and Mastercard. With the new clearing license, Paxos can combine its regulated stock clearing capabilities with its existing product line, expanding its services to institutional clients.

According to reports, the SEC had provided Paxos with no-action relief as early as 2019, enabling it to proceed with the relevant pilot program. In February 2020, Paxos launched a live settlement pilot program and connected with traditional financial institutions such as Bank of America, Credit Suisse, and Société Générale to handle the clearing and settlement processes for daily U.S. stock transactions.

The goal is to bypass traditional post-trade infrastructure.

In traditional capital markets, stock matching typically takes only milliseconds, but final settlement is often much slower. This is because cash settlement and legally binding asset transfers require processing by a centralized clearinghouse. While this process is mature, it can also introduce structural delays, collateral requirements, and counterparty risk.

Paxos's official registration means its blockchain settlement model can now be directly integrated into the US stock aftermarket trading market within a compliant framework. If more institutions adopt this technology, it could drive securities settlement from batch processing to shorter-cycle or even near-real-time delivery models.