Avalanche will supply the ledger that records and settles trades for a planned tokenized-securities venue affiliated with the New York Stock Exchange, Ava Labs announced on Nov. 9. The upcoming alternative trading system (ATS) is intended to offer round-the-clock trading, clearing, and settlement, subject to regulatory approvals.
The venue was initially outlined by NYSE parent Intercontinental Exchange on Jan. 19, with distribution through non-discriminatory access for qualified broker-dealers. That design paired NYSE's Pillar matching engine with blockchain-based post-trade systems, along with planned dollar-sized orders, stablecoin funding, and immediate settlement.
Clearing ledger choice
Avalanche will provide the core ledger technology to the platform's clearing firm. Dennis Lee, NYSE's head of digital issuance, said in the Ava Labs release that the ledger needed speed, reliability, predictable costs, developers, and the ability to "let us control who can take part."
Lee also said the platform would support equities on a range of blockchains, so the announced clearing-ledger choice does not require every security traded on the venue to use Avalanche as its issuance chain.
In its implementation explanation, Avalanche said institutions can tailor performance, capacity, costs and network participation to their operational requirements. Avalanche presents that flexibility as a way to meet a market operator's requirements, including control over participation.
Broker access and regulatory status
NYSE's Nov. 2 update reaffirmed distribution through participating broker-dealers and said regulatory approval remained pending. Broker distribution was part of January's design, and NYSE reiterated participating broker access in its November update.
The proposed venue remains subject to regulatory approval, with individual customer eligibility and account arrangements still unspecified. Ledger participation controls are not a complete customer eligibility policy.
NYSE's November update describes both third-party custodial tokens and issuer-sponsored tokenized securities as fungible with traditionally issued shares, carrying the same dividends and governance rights. The intended use of blockchain for settlement would sit alongside those familiar ownership rights.
