The New York Stock Exchange (NYSE) has announced plans to launch a fully independent trading venue for tokenized securities.
The announcement has drawn some praise from crypto heavyweight Changpeng Zhao (CZ).
In a recent social media post, the former Binance CEO has labeled the move as “bullish for crypto and crypto exchanges.”
The “two-exchange” strategy
The NYSE is building a parallel stock market that will run on blockchain rails.
As explained by fintech analyst Simon Taylor, the NYSE has chosen to operate two distinct venues in parallel.
The new digital venue will operate 24/7 and feature instant settlement with the help of stablecoins.
“Think about what this means: NYSE will run two exchanges. The old one: 9:30-4:00 EST, T+1 settlement, bank wires. The new one: 24/7, instant settlement, stablecoin rails. They’re not choosing between traditional and digital,” he said.
Most current tokenization efforts (like those by the DTCC or State Street) focus on creating digital “wrappers” for existing assets. For example, a standard share of Apple stock held at the DTCC might be represented by a token.
The NYSE’s new venue, however, targets native digital issuance. Settlements will happen directly on the blockchain. Custody will be wallet-based, meaning that investors will have full control over their assets. Funding and capital raises will happen via stablecoins.
As Taylor notes, “NYSE is building a new way to bring equities on-chain AND the venue to trade them.” This puts the NYSE in direct competition with crypto-native upstarts.