Paxos became the first blockchain-native firm approved by the SEC as a registered clearing agency in the US.
Blockchain infrastructure company and stablecoin issuer Paxos said on Thursday that its subsidiary, Paxos Securities Settlement Company, has become the first blockchain-native firm registered by the US Securities and Exchange Commission (SEC) as a clearing agency, giving it authorization to provide clearing and settlement services as a central securities depository in the United States.
Paxos co-founder and CEO Charles Cascarilla described the registration as the result of seven years of regulatory engagement, beginning with an SEC no-action letter in 2019 that allowed the company to pilot a blockchain-based settlement service for US equities. That pilot launched in February 2020, and Paxos said it demonstrated that blockchain infrastructure could support same-day settlement, lower costs, and improve operational efficiency within a regulated framework.
Clearing agencies sit at the center of securities markets, verifying trades, matching buyers and sellers, and ensuring the actual transfer of money and securities is completed correctly. Buyers and sellers in equity markets do not transact directly, making settlement infrastructure a critical and regulated function. A registered blockchain-based clearinghouse removes a key compliance barrier for banks and brokerages seeking to build crypto-enabled financial infrastructure.
Paxos described the approval as "a critical piece of financial market infrastructure" as blockchain technology and traditional capital markets continue to converge. The company had a contentious period with the SEC under former chair Gary Gensler, receiving a Wells Notice in 2023 over stablecoin issuance practices. The SEC closed its investigation in 2024 and issued a formal termination notice, confirming it would not pursue enforcement action.
The clearing agency registration marks a significant shift in Paxos's regulatory standing, coming seven years after the company first began operating under SEC oversight through its equity settlement pilot. Cascarilla said the approval reflects the firm's long-term commitment to building regulated blockchain infrastructure alongside traditional financial institutions.
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