Twenty-two public companies have now objected to tokenised versions of their shares being traded on a new venue set up under a US Securities and Exchange Commission exemption.
The venue, run by crypto exchange OKX and Intercontinental Exchange, owner of the New York Stock Exchange, published its list of objecting companies this week.
Who has said no
On Monday, the objectors disclosed included Microsoft, Alphabet, Goldman Sachs and McDonald’s, along with three others. On Friday, Wells Fargo, Cisco and four more companies were added.
Nasdaq has also said it intends to object to tokenised versions of its own stock trading on these venues under the current exemption. It cited concerns about liquidity being split across markets and weaker price discovery.
Securitize and BitGo, both publicly listed, have said they will not object to tokenised versions of their own shares.
How the rules work
Under the SEC’s innovation exemption framework for tokenised securities venues, a venue must notify a company and give it 30 days to object. If the company stays silent, trading can begin.
According to law firm Latham & Watkins, that silence is effectively permanent. The SEC order gives no way to object after the 30-day window, or to withdraw a non-objection later.
Why companies are hesitating
“Most of these companies had no idea a third party had tokenised their stock until the OKXICE notice went up,” said Dave Hendricks, chief executive and founder of tokenisation firm Vertalo.
Olivia Vande Woude, head of tokenisation at Ava Labs, said: “This exemption is a data-gathering exercise. What it’s showing is that public companies want a say in how their shares come onchain.”
Reid Noch, vice president of US equity market structure at TD Securities, has said the upside for companies is hard to measure, and the framework may not create enough new demand to outweigh the risks.
“There’s an important education process underway,” said Securitize chief executive Carlos Domingo.
What happens next
Under the exemption’s rules, the objections should keep these companies’ shares off this venue. The open question is whether more companies object as further notices go out, or whether others stay silent and allow trading to begin.
