New York — NYSE Parent's Tokenized Stock Plan Hits Snag

A plan by the New York Stock Exchange's parent company to put stock trading on blockchain technology has run into resistance from some of the largest firms it hoped to include, according to the Financial Times.

Intercontinental Exchange, which owns the NYSE, proposed a list of 62 companies for its tokenized stock program. Of those, 38 have told the exchange operator they do not want their shares included, the FT reported. Alphabet, Oracle and Microsoft are among the firms that have objected.

What is NYSE's parent trying to do?

Intercontinental Exchange wants to offer tokenized versions of publicly traded stocks. Tokenization turns a share into a digital record that can move on blockchain networks, the same technology behind cryptocurrencies. Backers of the idea say it could let shares trade faster and at more hours than the current stock market allows.

Which companies are pushing back?

The FT identified Alphabet, Oracle and Microsoft as three of the 38 companies that told the exchange they want to be left out of the initial list of 62. The report did not name the other objecting firms or detail each company's stated reason.

Why would a company refuse to let its stock be tokenized?

The FT report did not quote company officials explaining their objections. The dispute highlights a broader tension in corporate finance: exchanges and brokers want to modernize how shares trade, but companies that list those shares do not always control, or welcome, how that happens. Any public company's board can object to third-party programs involving its stock, even voluntary ones, if it has concerns about oversight, regulation or reputational risk.

By the numbers

• 62 — companies Intercontinental Exchange initially proposed for the tokenized stock program, per the FT
• 38 — companies that have told the exchange they do not want to be included
• 24 — companies from the original list that have not objected, based on the reported figures

What happens next for investors?

Nothing changes for shareholders of Alphabet, Oracle or Microsoft immediately. No tokenized trading of their shares is happening now, and the objections reported by the FT mean those stocks are unlikely to be part of any near-term launch. Intercontinental Exchange has not said how it will respond to the pushback or whether the program will move forward with a smaller list.

What should shareholders watch for next?

Investors in the companies that have not objected should watch for any formal announcement from Intercontinental Exchange about which stocks will actually launch in tokenized form, and on what timeline. The FT report did not include a target launch date or confirm which exchange or regulator would oversee the program once live. Any U.S. securities regulator approval needed for the plan was not detailed in the available reporting.

For now, the development is a corporate governance story more than a trading one: a Wall Street infrastructure company wants to bring blockchain technology to mainstream stocks, and a majority of the firms it approached first have said no.

Artiglio is A coming-soon iPhone chief of staff for briefings and drafts. Not on the App Store yet.