OKX has filed with the U.S. Securities and Exchange Commission through its OKXICE joint venture to launch a platform initially covering tokenized shares of 63 NYSE-listed companies.
Summary
- OKXICE filed with the SEC to offer tokenized shares of 63 NYSE-listed companies to investors.
- SEC rules require qualifying tokenized stocks to preserve dividends, voting rights, and equivalent shareholder claims.
- Issuers get 30 calendar days to object before unaffiliated third-party tokenized shares can begin trading.
- OKX already offers tokenized stocks offshore, but current products do not provide direct shareholder rights.
- OKXICE remains subject to regulatory conditions before its U.S. tokenized stock platform can launch commercially.
Bloomberg reported on Oct. 4 that OKXICE LLC, the 50-50 venture between OKX and New York Stock Exchange parent Intercontinental Exchange, submitted paperwork seeking to use the SECs new tokenized-stock framework. The filing itself had not yet surfaced in publicly searchable SEC records when checked.
The plan would make digital versions of the selected shares available under conditions set by the SECs Innovation Exemption. Issuers would receive notice before trading begins and would have 30 calendar days to object when an unaffiliated third party creates the tokenized version of their stock.
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OKX plans to start with 63 NYSE-listed stocks
OKXICE intends to begin with shares of 63 companies listed on the New York Stock Exchange, according to the reported filing. The individual companies were not identified in the publicly available reporting reviewed for this article.
The venture was formed in June after OKX and ICE deepened a partnership that began with ICEs strategic investment in the crypto exchange in March. The companies announced that OKXICE would focus on tokenized financial products and, subject to regulatory approval, seek to operate as a U.S.-registered broker-dealer and futures commission merchant.
OKX has filed with the SEC to launch tokenized U.S. stock trading.
Another major step towards bringing traditional stocks onchain.
ICE owns the New York Stock Exchange and supplies trading, clearing and market-data infrastructure across traditional financial markets. OKX provides the blockchain and crypto infrastructure for the joint venture.
The 50-50 venture is co-chaired by former New York Governor Andrew Cuomo and ICE executive Trabue Bland. Cuomo said in the June announcement that the next phase of financial markets depends on innovation and regulation moving forward together.
“The next chapter of financial markets will be defined by how well innovation and government regulation can move forward together,” Cuomo said.
As previously reported, the OKX and ICE tokenized-market venture was designed to give OKX customers access to ICE futures and tokenized equities linked to NYSE markets if regulatory approvals were secured.
SEC rules give stock issuers 30 days to object
The regulatory route became clearer on Sept. 17 when the SEC issued its Innovation Exemption for Tokenized Securities Venues.
The temporary framework gives qualifying venues five years of conditional relief from the Exchange Act definition of an exchange when trading tokenized National Market System stocks through permissioned automated market makers and liquidity pools.
For shares tokenized by a third party with no affiliation to the company, the venue must first send written notice to the underlying issuer. Trading cannot start for at least 30 calendar days after the company receives the notice.
An issuer can object during that period. If it does, the venue cannot make the tokenized version of that companys stock available under the exemption. The platform must publicly disclose the objection within five business days.
The rule does not provide venues with an unrestricted path to tokenize every public company. Tier 1 stocks are capped at 75 symbols per venue under the exemption, while Tier 2 stocks are capped at 250. Trading volume is restricted to 0.25% of the prior months average daily share volume for Tier 1 securities and 2.5% for Tier 2 stocks.
The proposed 63-stock OKXICE lineup therefore falls below the SECs 75-symbol ceiling for Tier 1 stocks if all planned names fall in that category. The reported filing has not publicly disclosed enough detail to determine how the proposed securities are divided between the two tiers.
In related coverage, the SECs five-year tokenized-stock exemption created a route for eligible venues to test onchain stock trading while remaining subject to limits on volume, symbols, smart contracts and trading halts.
Tokenized shares must carry real shareholder rights
OKXICE cannot simply use the same product structure OKX currently offers to many customers outside the United States.
The SEC order requires a qualifying tokenized share to give its holder the same rights and privileges as a conventional share of the equivalent class. The agency specifically lists the underlying interest in the company, dividends, voting rights and claims on residual assets during liquidation.
Investor communications and proxy materials must be made available when an unaffiliated third party tokenizes the shares. Primary offerings are not permitted on a Tokenized Securities Venue under the exemption.
The requirements differ from OKXs existing Unified Tokenized Stocks. OKX said in August that the offshore product provides price exposure to shares and ETFs and supports deposits and withdrawals on Solana and X Layer. Trading runs 24 hours a day against USDT.
The company explicitly states that those products do not represent ownership in the underlying company and do not give customers shareholder voting rights.
OKX launched the product with more than 40 tokenized stocks and ETFs in July before expanding the offering. The current structure is unavailable to U.S. customers and operates separately from the proposed OKXICE platform.
Crypto.news previously reported that tokenized stocks under the SEC exemption must preserve real shareholder rights, with OKX U.S. CEO Roshan Robert saying changing the trading technology should not alter an investors claim on the underlying company.
OKXICE still has several steps before trading begins
Submitting a notice does not mean the 63 tokenized stocks can begin trading immediately.
For third-party tokenized shares, the 30-day period does not begin until each issuer receives the required notice. Any timely objection prevents that particular tokenized security from trading under the exemption.
OKXICE must meet the SECs remaining operational conditions as well. Smart contracts used by the venue must be public and auditable and run on a public, permissionless distributed ledger. The platform must stop trading a tokenized share whenever trading in the conventional stock is halted on its primary exchange.
Transaction information must be made freely available in machine-readable form. The SEC order requires venues to maintain 30 days of transaction data and update it within 10 minutes after trades occur.
The ventures earlier plans include obtaining U.S. broker-dealer and futures commission merchant status. When OKX and ICE formed OKXICE in June, both companies said those activities remained subject to regulatory approval.
ICEs involvement follows its March investment in OKX, which valued the crypto company at approximately $25 billion, according to reporting at the time. The investment gave ICE board representation and expanded cooperation around regulated U.S. markets.
The SECs Innovation Exemption remains temporary. It is scheduled to expire five years after publication while the commission considers whether permanent rules should replace or modify the framework.
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