Companies Turn Down Tokenized Stocks as Wall Street Tests Its Crypto Push

what happened

The OKX and NYSE parent Intercontinental Exchange joint venture, OKXICE, posted a notice that nine companies have objected to their shares trading on its proposed tokenized securities venue. That removes about 14% of the 63 stocks it planned to include. The objection process was set up under an SEC innovation exemption issued last month.

Objectors named so far include Cerebras Systems, AppLovin, Applied Digital, Rocket Lab, CoreWeave, Verizon, Applied Optoelectronics, Broadcom and UnitedHealth Group. Applied Optoelectronics said the new framework could have an uncertain effect on its stock's price, liquidity and volatility. OKXICE co-chairman Andrew Cuomo said objections were expected during a transition period.

why it matters

The OKXICE venture would let retail investors trade tokenized stocks, while the DTCC service mostly handles post-trade steps for institutions and runs around the clock. Issuer opt-outs may restrict some venues, but Barron's notes that tokenization projects that do not depend on company cooperation are likely to continue.

market impact

Stock market: issuer opt-outs narrow the tokenized stock lineup and cloud liquidity expectations for listed shares

tags

instruments