Widespread Issuer Resistance to Tokenized Stock Trading
The U.S. Securities and Exchange Commission's emerging framework for tokenized equity trading has run into significant opposition from some of the very companies whose shares would be listed. Broadcom (AVGO), Verizon (VZ), and UnitedHealth (UNH) are among the most prominent issuers to register formal objections, according to a public notice filed on October 15 by OKXICE — the joint venture between crypto exchange OKX and Intercontinental Exchange (ICE), parent company of the New York Stock Exchange.
The notice reveals eight newly disclosed objections, bringing the total number of objecting issuers to nine. Alongside Broadcom, Verizon, and UnitedHealth, the list includes AppLovin (APP), Applied Digital (APLD), Rocket Lab (RKLB), CoreWeave (CRWV), and Applied Optoelectronics (AAOI). AI chipmaker Cerebras Systems (CBRS), which had already formally opted out of listing earlier, rounds out the group. Notably, the filing did not specify the reasons each company gave for its objection nor the dates on which the notices were submitted.
Separately, Nasdaq (NDAQ) has indicated it will not have its own shares tokenized under the framework, per an FAQ posted on its website. A Nasdaq spokesperson told the Wall Street Journal that the company objects to its equity trading on a venue that does not display best available prices in real time or report transaction data to the consolidated tape — the system that aggregates U.S. stock-market trading information. Nasdaq is not included among the nine issuers named in OKXICE's filing.
How the OKXICE Platform Is Designed to Operate
OKXICE disclosed on October 5 that it had notified the SEC of its plans to launch the trading venue, initially targeting shares of 63 U.S.-listed companies. Former New York Governor Andrew Cuomo, who serves as the venture's co-chair, announced the development on the social platform X.
The venue will function under the SEC's five-year "Innovation Exemption," granted on September 17, which permits qualifying platforms to trade tokenized U.S. equities using automated market makers and liquidity pools. In practical terms, tokenized stocks are blockchain-based digital representations of traditional shares. OKXICE intends to run the platform on a 24/7 basis, utilizing Uniswap v4 liquidity pools on OKX's XLayer blockchain, with all trades settled in stablecoins.
Under the structure outlined in the notice, each outstanding token would be backed one-for-one by underlying shares held through a registered broker-dealer. Token holders would be entitled to the same rights as conventional shareholders, including participation in dividends and access to voting privileges.
Analyst Warnings: Regulatory Fragility and Market Fragmentation
The issuer pushback mirrors findings published by TD Securities, led by Reid Noch, vice president of U.S. equity market structure. In a report shared with CoinDesk, Noch and colleagues described conversations with dozens of issuers and concluded there is "little interest in tokenizing their shares outside a small group of crypto-adjacent companies."
Several issuers also reached out to TD Securities with serious concerns after learning about the framework, many of whom had been unaware of its existence when it was first announced, the report noted.
The analysts identified the framework's dependence on temporary exemptive relief — rather than permanent rulemaking — as the single largest obstacle. A future SEC commission could potentially reverse the approach, which would undermine the business case for building infrastructure around tokenized equity trading and discourage institutional investors from integrating with these venues even after they go live.
That regulatory uncertainty becomes particularly acute, the analysts added, when overseas platforms can continue offering synthetic stock products without bearing the operational obligations imposed by the U.S. relief regime — a dynamic that could fragment liquidity and disadvantage domestic issuers and investors alike.