Blockchain.com and NYSE plan direct pipeline to tokenized stocks, subject to regulatory approval

Blockchain.com and NYSE Group signed a memorandum of understanding on September 23 to offer Blockchain.com's users access to tokenized U.S. stocks and ETFs through NYSE's planned digital alternative trading system, according to Decrypt. The arrangement requires regulatory approvals, and NYSE's platform has not yet launched.

Tokenized stocks are blockchain-based tokens representing shares of listed companies, enabling fractional ownership and faster settlement, per Decrypt's reporting. NYSE announced in January that it is building the venue as a digital alternative trading system (ATS), a regulated marketplace that operates outside a traditional exchange and promises 24/7 trading and instant on-chain settlement.

Blockchain.com has more than 44 million confirmed accounts across more than 70 jurisdictions, according to Decrypt. The arrangement also includes a data partnership: ICE Data Services plans to distribute Blockchain.com's crypto market data to its subscribers, while Blockchain.com will add certain NYSE and ICE feeds to its app, per Decrypt's reporting.

Peter Smith, Blockchain.com's CEO and co-founder, stated, "People shouldn't be limited in owning stocks based on where they happen to live or the brokerage and information they may or may not have access to," according to Decrypt. NYSE Group President Lynn Martin said, "The future of capital markets belongs to institutions that unite the trust of traditional finance with the innovation and accessibility of digital assets," per Bitcoin Magazine.

The regulatory backdrop has shifted in tokenized assets' favor. Last week, the SEC unveiled an "innovation exemption" letting qualifying venues trade tokenized U.S. stocks on public blockchains without registering as exchanges, per Decrypt. Blockchain.com confidentially filed for a U.S. IPO in May, according to Decrypt. NYSE's parent company, Intercontinental Exchange, invested in crypto exchange OKX earlier this year, according to Bitcoin Magazine.

Competition in tokenized equities is accelerating. Coinbase launched tokenized stocks on Base, its Ethereum layer-2 network, for non-U.S. users in August, according to Decrypt. In January, the S&P 500 gave crypto platform Trade[XYZ] the green light to debut a new derivative contract on decentralized exchange Hyperliquid, giving traders the ability to trade the stock index 24/7, per Bitcoin Magazine. Payward, the parent company of crypto exchange Kraken, and fintech company SoFi Technologies announced a deal to route SoFi customers' crypto orders through Kraken's institutional trading platform and list SoFi's stablecoin on the exchange, according to Bitcoin Magazine. Neither Blockchain.com nor NYSE disclosed a launch date or financial terms.