Burry Warns SEC Tokenized-Stock Plan Risks Investor Nightmare

On May 24 Michael Burry criticized the SEC’s proposed innovation exemption that would let tokenized stocks trade 24/7 on blockchain venues, warning of price fragmentation, lost investor protections and heightened manipulation risk. The warning follows the SEC’s May 19–20 proposals—the largest IPO-rule overhaul in over two decades—which would grant immediate shelf registration, lift the large accelerated filer threshold to $2 billion, and extend scaled disclosures to roughly 81 percent of listed firms. While the earlier measures were viewed as supportive of IPO activity and US equity sentiment, the latest critique highlights potential downsides for market stability and retail investors.