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Business

NYSE and Blockchain.com to explore selling tokenised stocks

The New York Stock Exchange and Blockchain.com have announced a strategic collaboration to explore selling blockchain tokens representing NYSE-listed stocks and ETFs.

By James Calloway · · 1 min read

The facade of the New York Stock Exchange building on Wall Street, with US flags and the Wall Street sign visible.
Photo: Carlos Delgado, Wikimedia Commons (CC-BY-SA 4.0) · source

The New York Stock Exchange and crypto exchange Blockchain.com are to explore creating crypto versions of US-listed stocks, Blockchain.com said in a press release on Wednesday.

The two companies announced a “strategic collaboration” to look at selling tokens representing NYSE-listed stocks and exchange-traded funds (ETFs) on blockchain, the technology behind cryptocurrencies. Tokenisation — creating blockchain-based tokens representing assets such as stocks and bonds — is the latest example of a mainstream exchange looking to cash in on the trend, Reuters reported. The companies have not yet announced which countries the products will be sold in.

They also signed a data agreement: Intercontinental Exchange (ICE), the NYSE’s parent company, will distribute Blockchain.com’s crypto market data and analytics, while Blockchain.com will use NYSE data in its app.

“It’s a bet by both parties on where capital markets are heading,” Blockchain.com said.

Reuters noted that blockchain-based stock tokens rarely offer buyers the same rights as traditional equities, and the buyer typically does not become a shareholder in the underlying company, raising investor-protection concerns. Proponents say the tokens could enable more people to buy stocks and trade them outside of standard market hours.

Blockchain.com, based in London and Dallas, has already started selling tokenised stocks to customers in Europe. The move comes days after the US Securities and Exchange Commission unveiled a five-year “Innovation Exemption” allowing platforms to sell blockchain-based versions of stocks without following many of the rules that apply to stock exchanges.

Sources

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