F/m Investments applies to tokenize ETF shares, aiming to become the first issuer to promote ETF tokenization

F/m Investments, an ETF issuer managing approximately $18 billion, has applied for regulatory approval from the U.S. Securities and Exchange Commission (SEC) to tokenize its ETF shares and record them on a permissioned blockchain ledger. The product the company intends to tokenize is its U.S. Treasury 3-Month Bill ETF (TBIL, NASDAQ: TBIL).

F/m Investments stated that this is the first time an institution has explicitly applied to the SEC for an exemption regarding the "tokenization of registered investment company ETF shares." The company claims that if approved, the existing TBIL ETF shares will be represented on the permissioned ledger with the same CUSIP code, and will maintain consistency in rights, fees, voting rights, and economic terms with the existing ETF shares, remaining subject to the Investment Company Act of 1940.

The company also emphasized that the relevant arrangements will continue to retain board oversight, daily information disclosure, and third-party custody and audit mechanisms. F/m Investments CEO Alexander Morris stated that the trend of tokenizing traditional financial instruments is inevitable.