Andrew Cuomo, co-chair of OKXICE and former New York governor, said objections from major US companies to the venture’s proposed tokenized stock trading platform were an expected response to a new market structure, as the number of opposing issuers reached 16.
“This is a very natural response,” Cuomo said during a Tuesday press call. He added that the model was designed to allow companies to decide whether to participate.
The comments followed an October 19 notice from OKXICE, a joint venture between crypto exchange OKX and Intercontinental Exchange (ICE), the parent company of the New York Stock Exchange.
Microsoft, Alphabet, Goldman Sachs, Qualcomm, Caterpillar, McDonald’s and Western Digital were among seven additional companies that objected to having tokenized versions of their shares traded on the proposed platform.
They joined nine previously disclosed objectors, including Broadcom, Verizon, UnitedHealth, CoreWeave and AppLovin. The latest additions bring the total to 16 companies, representing roughly a quarter of the 62 companies initially proposed for the platform.
Cuomo said many companies were likely to observe the platform’s development before deciding whether to participate.
“We always anticipated that, because this is such a dramatic and revolutionary change, many companies would want to wait and see how it goes rather than be the first to participate,” he said.
The companies’ formal notices did not disclose their individual reasons for objecting.
Issuer objections test SEC’s tokenized stock framework
OKXICE announced its proposed trading venue on October 5 under the Securities and Exchange Commission’s five year Innovation Exemption, introduced on September 17.
The framework allows qualifying platforms to offer blockchain representations of US listed stocks through automated market makers and liquidity pools, subject to regulatory conditions and issuer objections.
OKXICE plans to offer trading around the clock through permissioned Uniswap v4 liquidity pools deployed on OKX’s XLayer blockchain.
Each tokenized share would be backed by an underlying stock held through a registered broker dealer, with equivalent dividend and voting rights. Trades would use stablecoins including USDT, USDC and USDG.
However, the proposed structure has raised questions about pricing, liquidity, investor protections and the relationship between tokenized securities platforms and traditional equity markets.
Carlos Domingo, CEO of tokenization company Securitize, said that issuers need greater clarity about how the new markets operate, particularly regarding pricing and shareholder rights.
Dave Hendrick, CEO of tokenization platform Vertalo, also highlighted the absence of infrastructure to synchronize trading between traditional exchanges and tokenized securities venues.
The objections come as US regulators seek to establish a framework for blockchain based stock trading while maintaining protections for companies and investors.
Cuomo characterized the initiative as a limited experiment, noting that the framework restricts both the number of participating companies and trading volumes.
Disclosure: This article was edited by Vivian Nguyen. For more information on how we create and review content, see our Editorial Policy.