The filing that brings private markets onchain at scale

Combined with WisdomTree’s recent relief, ARK’s application could give the SEC a blueprint for making tokenized share classes a repeatable feature of registered funds.

One of the most consequential tokenization filings in Washington right now is not about crypto. It is about the Investment Company Act of 1940.

Read alongside WisdomTree’s February exemptive order, ARK Invest’s application raises a bigger question than whether one venture fund can issue digital shares: when does tokenization stop requiring bespoke SEC relief and become a standard feature of a registered fund?

That is the real unlock. If the SEC can move from one-off orders toward a rule-based framework, existing funds could add native tokenized share classes without creating new feeder funds, wrappers or parallel products simply to reach onchain markets.

What ARK is actually asking for

ARK Invest is seeking to amend its existing multi-class relief for the ARK Venture Fund (“ARKVX”), a registered closed-end interval fund, so it can offer a Tokenized Class alongside its existing share classes. The application seeks amendments to ARK’s existing relief under Sections 18 and 17 and Rule 23c-3, which govern its multi-class structure, repurchase mechanics and related arrangements. The key change from ARK’s prior order is that the Tokenized Class could trade on regulated Alternative Trading Systems and other permitted secondary venues rather than being limited to a fund with no secondary market.

Mechanically, ARK is not asking the SEC to create a new category of security. The underlying portfolio and the registered fund remain in place. Ownership of the Tokenized Class would be recorded using distributed-ledger technology, wallets would be whitelisted and subject to KYC/AML controls, and secondary transfers could occur through registered secondary exchanges.

That distinction matters because ARKVX holds illiquid late-stage private-company positions and currently provides liquidity through quarterly repurchase windows capped at 5% of the fund’s outstanding shares. Under the proposed structure, an investor who wants liquidity before the next repurchase window could sell the tokenized fund share in the secondary market at a negotiated market price, potentially at a premium or discount to the fund’s daily published NAV. The fund itself would not have to redeem the underlying private assets to make that trade happen.

This is also where blockchain rails become more than a new recordkeeping format. In traditional fund infrastructure, execution, settlement, custody and transfer-agent records can sit across separate systems. With a native tokenized share class, the share can transfer onchain, settlement can occur atomically, and the ownership record can update as part of the same digital workflow. Tokenization does not create liquidity by itself, but it removes much of the operational friction that has historically made secondary trading of private-market fund interests difficult to scale.

Why WisdomTree matters, and why ARK is different

WisdomTree established an important first precedent, but the products are structurally different. WTGXX is an open-end money-market fund designed to maintain a stable $1 NAV. Its relief allows participating broker-dealers, including an affiliated dealer, to buy and sell fund shares as principal at $1 per share rather than at the next-calculated NAV, supporting 24/7 trading and instant settlement within the U.S. regulatory perimeter.

ARK is testing the same broader principle in harder territory. ARKVX is an interval fund holding private assets with quarterly liquidity. Its Tokenized Class would not rely on a dealer maintaining a fixed $1 price. Instead, secondary buyers and sellers could transact around a daily published NAV, with the market pricing the duration risk of the underlying assets. WisdomTree proved registered funds can exist on digital rails. ARK is seeking to test them against illiquid private-market assets, where secondary liquidity has the most to solve.

These are not the first managers to bring fund interests onchain. BlackRock, Apollo, Franklin Templeton, Hamilton Lane, and others have already pushed tokenized funds forward. What makes this application different is the combination of a registered interval-fund structure, retail accessibility and a proposed secondary market around private-company exposure.

Standardization is the real unlock

If ARK receives the requested relief, the SEC will have multiple real-world examples of registered fund shares operating on digital infrastructure while remaining inside the existing investor-protection framework. The scalable outcome is not for every asset manager to file a substantially similar exemptive application. It is a common regulatory framework under which qualifying funds can introduce tokenized share classes subject to defined requirements around transfer agency, custody, KYC, trading, recordkeeping and investor protection.

That would not require Congress to rewrite the Investment Company Act. It could come through SEC rulemaking or other generally applicable regulatory relief under the Act.

At that point, tokenization starts to look less like launching a new financial product and more like upgrading the infrastructure around an existing one.

Private markets in 401(k)s need a liquidity layer

The timing matters. In August 2025, the White House directed federal agencies to expand access to alternative assets in defined-contribution plans, and in March 2026 the Department of Labor proposed a rule addressing how fiduciaries can evaluate alternatives in 401(k) lineups. That has turned private-market access for retirement savers into an active policy question, not a theoretical one.

One of the operational mismatches is liquidity. Retirement portfolios have regular inflows and outflows and need to rebalance, while many private-market funds operate around quarterly repurchase windows or periodic tenders. A regulated secondary market does not make the underlying private companies liquid, and it does not by itself make a fund appropriate for a 401(k). As secondary market liquidity improves, however, these fund shares become easier to rebalance, manage, and incorporate into large portfolios.

The important shift is that liquidity can come from the market, not from the fund's own repurchase program. 

What happens once the share can trade

Getting a fund onchain is only the first step. The larger opportunity comes when those shares can begin to function inside digital capital markets.

A tokenized fund interest that trades with enough depth can potentially be used as collateral in lending markets such as Aave, Morpho or Kamino, incorporated into corporate treasury strategies, or held inside larger managed portfolios that need more flexible liquidity and rebalancing. That starts to move private-market exposure from a static investment into something that can be financed, allocated and managed more dynamically.

None of that happens automatically. These markets need real two-sided liquidity, credible pricing, lenders willing to underwrite the risk, and risk frameworks that account for the underlying assets, redemption terms and secondary market depth. Tokenization creates the technical rails; liquidity and underwriting make the asset useful.

This is where the convergence of traditional finance and DeFi becomes particularly important. Traditional funds bring regulated structures and institutional-quality assets. DeFi brings programmable markets, around-the-clock settlement and new ways to finance and use those assets. If the infrastructure on both sides continues to mature, that combination could materially expand how private-market products are bought, financed and managed.

What to watch on September 18

The SEC has published formal notice of ARK’s application and stated that an order granting the requested relief will be issued unless it orders a hearing. The deadline to request a hearing is September 18, 2026.

The bottom line

ARK’s application matters because it tests whether digital market infrastructure can work around a fund holding genuinely illiquid private assets, not just a liquid money-market product. If approved, the immediate significance is not that every fund can tokenize tomorrow. It is that the SEC will have another workable model for how tokenized share classes can fit inside the existing ’40 Act framework.

The next signal will come from the market. If other managers begin filing for similar relief, the question will shift from whether tokenized share classes can work under the ’40 Act to how quickly the SEC can give the market a repeatable path to launch them.

Author disclosure: Jonathan Shaffer and Steve Bendit are executives at Fission Labs, which builds liquidity infrastructure for tokenized private-market assets.