Major companies block tokenized share trading on New blockchain venue
Several prominent corporations, including Apple, Amazon, and Tesla, have formally opposed the tokenized trading of their shares on a forthcoming blockchain-based stock trading platform. The venue, a joint venture between Intercontinental Exchange (ICE), the parent company of the New York Stock Exchange, and OKX, has faced growing resistance, with approximately 62 companies now registered as objecting, according to Unchained.
This opposition marks a significant shift from mid-October when only nine companies had voiced concerns. The list of companies opting out has rapidly expanded, encompassing names like Boeing, ServiceNow, Nebius Group, Home Depot, GE Vernova, and Lam Research. Earlier objectors include Microsoft, NVIDIA, JPMorgan Chase, Goldman Sachs, Walmart, and Nike.
The planned venue, operated by OKXICE LLC, intends to facilitate trading in digital tokens representing U.S. stocks, created by third parties. These tokens would be traded against stablecoins, utilizing automated market maker pools rather than traditional order books. The platform operates under an SEC exemptive order and is not a fully registered exchange.
Companies receive written notice before a token linked to their stock can be listed. A written objection within a 30-day window prevents the token from being offered on the venue, with a revised notice published within five business days. While companies can block third-party tokenization, they retain the option to tokenize and list their own shares if desired.
The reasons for these objections remain undisclosed. However, the SEC’s order highlights potential concerns, such as maintaining shareholder records and the impact on the underlying stock’s price.
The widespread opt-outs significantly diminish the appeal of 24/7 trading, a key selling point of tokenized stocks. These objections do not affect the companies’ traditional shares, and existing investments in shares or ETFs remain unaffected.
Despite the U.S. resistance, demand for tokenized stocks persists internationally. Following SpaceX’s listing in June, tokens traded on Backpack and Kraken generated substantial trading volumes, demonstrating a clear appetite for this type of product outside of the United States. Currently, the companies whose stocks would make a tokenized market worthwhile are the same ones declining participation, limiting the appeal of tokenized stocks for U.S. investors.
Source
“Can Companies Stop Their Shares From Being Tokenized? Many Big Names Say Yes”
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