WisdomTree SEC Approval: 24/7 Trading of Tokenized Treasury Fund
The U.S. Securities and Exchange Commission (SEC) on Tuesday approved a landmark regulatory change allowing WisdomTree Investments to begin continuous, 24/7 trading of its tokenized fund, the WisdomTree Treasury Money Market Digital Fund (WTGXX). The approval, also endorsed by the Financial Industry Regulatory Authority (FINRA), enables instant settlement of fund shares – maintained at a stable $1.00 net asset value – via blockchain technology, breaking from traditional banking market close cycles and validating the use of the technology for U.S. Treasury assets.
Traditional mutual funds operate under structural limitations stemming from the 20th century: valuations and settlements occur only once daily, at market close (typically 4:00 p.m. New York time). This means a sell order placed on a Friday evening would not be executed until Monday or Tuesday at the earliest. WisdomTree secured a specific exemption, known as “exemptive relief,” from the Investment Company Act of 1940, now permitting the use of a blockchain to record ownership and settle secondary transactions at any time, including weekends and holidays. This move aligns the traditional market with the infrastructure of the crypto world, mirroring a recent trend seen with the CME Group’s announcement of 24/7 trading of Bitcoin derivatives, signaling a convergence of financial infrastructure where markets never sleep.
The approval legitimizes tokenization and introduces a hybrid operational model that could serve as a foundation for future financial products. Technically, the fund utilizes a “dealer-principal” model, with WisdomTree Securities acting as the direct counterparty. The firm buys and sells shares using its own balance sheet to guarantee immediate liquidity to investors, rather than relying on the traditional fund redemption process. The infrastructure supports instant conversion using stablecoins like USDC (Circle) and PYUSD (PayPal), facilitating a seamless on- and off-ramp between the crypto ecosystem and the U.S. Dollar. According to reporting by The Block, this marks the first instance of a registered mutual fund receiving such broad exemption for intraday settlement, validating blockchain’s role as an official transfer agent.
The SEC’s decision arrives as institutional actors, such as Wintermute, are already exploring the trading of tokenized gold and other real-world assets (RWAs), reinforcing the trend of traditional assets migrating to 24/7 rails. For investors, the development offers both increased access and regulatory modernization. The move simplifies exposure to the U.S. Dollar and U.S. Treasury bonds – considered a global “risk-free” asset – with the agility of a cryptocurrency transaction. Historically, those seeking dollar-denominated protection have faced barriers related to banking hours and remittance spreads. Regulated tokenization provides global and instant liquidity.
The SEC’s stance, under a renewed technical leadership, establishes an important precedent. Driven by individuals with real-world blockchain experience, including a former Chainlink executive appointed to a role within the agency, U.S. Regulation is beginning to focus on technical viability rather than outright prohibition. This “mirror effect” is likely to influence other local regulators, who are already studying similar models for the digitalization of capital markets.
Despite the optimism surrounding the innovation, the granted exemption is specific to WisdomTree and this fund, and is not an automatic rule for the entire market. The model relies heavily on the balance sheet capacity of the broker-dealer (WisdomTree Securities) to honor instant redemptions during periods of acute market stress. Investors should monitor the institutional adoption of this product in the coming months. The response of industry giants like BlackRock and Franklin Templeton will determine whether 24/7 settlement becomes the new gold standard for the industry or remains a niche offering.
The SEC’s authorization breaks a nearly century-old barrier in the structure of mutual funds. U.S. Government bonds can now be traded with the speed of a token, merging the legal security of the traditional market with the operational efficiency of blockchain technology.