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ARTICLE · 13 JULY 2026

From Rigid Routing To Best Execution: SEC Proposal Could Reshape Listed Equities And On-Chain Markets

Jones Day
Jones Day
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The SEC's proposed rescission of Regulation NMS Rules 611 and 610(e) could fundamentally transform how equity securities are traded by eliminating rigid routing requirements and locked market prohibitions. This shift from prescriptive rules to a best-execution framework may unlock the potential for tokenized equity securities to trade on decentralized exchanges and DeFi protocols. The proposal represents a significant step in the SEC's Project Crypto initiative to modernize markets and facilitate on-chain t

United StatesFinance and Banking
Michael Dawson
Michael Dawson
Abradat Kamalpour
Abradat Kamalpour
Nicholas Podsiadly
Nicholas Podsiadly
Laura S. Pruitt
Laura S. Pruitt
Mark W. Rasmussen
Mark W. Rasmussen
Trevin Crider
Trevin Crider
Paul R. DiPadua
Paul R. DiPadua
Michael Rust
Michael Rust
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In Short

The Situation: On June 11, 2026, the Securities and Exchange Commission (the "SEC") proposed the rescission of Rule 611 (the trade-through prohibition) and Rule 610(e) (the locked and crossed markets prohibitions) of Regulation NMS.

The Change: By eliminating the restrictive market structure rules, the SEC would remove a traditional backstop and instead rely on competitive market forces and broker-dealers' existing best execution obligations under FINRA Rule 5310 to govern order handling in the national market system. The SEC seeks to reduce costs from compliance and complexity while permitting further innovation.

Looking Ahead: If adopted, the SEC's proposed rescission could pave the way for trading of tokenized equity securities, including on decentralized exchanges and other decentralized finance ("DeFi") protocols. The SEC's proposal continues its Project Crypto mandate, which aims to modernize markets and allow markets to move on-chain.

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