Objections from 33 Issuers Stall Listing of Their Tokenized Shares on OKXICE
Key Facts
The number of stock issuers objecting to OKXICE’s plan has risen from 26 to 33, after a notice on October 27 added 7 companies, including JPMorgan Chase, AMD, Applied Materials, Coca-Cola, Adobe, Dell Technologies and Sandisk. The objections are now central to an effort to launch tokenized trading in shares of U.S. public companies under a temporary exemption granted by the U.S. Securities and Exchange Commission to platforms that meet specified conditions. The platform plans to offer round-the-clock trading through liquidity pools on OKX’s XLayer network, with transactions settled in stablecoins. In their notices, the objecting companies said they did not want their shares listed on this platform under the available framework. The notices do not state the reasons for the objections, so they do not establish that the companies oppose stock tokenization generally or trading their shares on other platforms.
The 7 additions came after an earlier notice on October 26 showed that 26 issuers had objected, bringing the announced total to 33 the following day. OKXICE’s original list, published on October 4, contained 63 tokens representing 62 companies, with Alphabet appearing in both share classes. The announced objections therefore now cover more than half of the companies on the original list. This expansion means the platform may face increasing restrictions on the names it can make available under the exemption. It does not mean that every stock on the list is now barred on every platform or under every stock-tokenization arrangement.
The SEC issued the conditional exemption on September 17 to allow tokenized stock trading on eligible platforms using automated market makers and licensed liquidity pools, subject to specified conditions. The framework requires the platform to notify the issuer in writing and give it an opportunity to object before offering a tokenized version of a stock issued by an unaffiliated party. Under SEC staff guidance, the platform cannot make the stock available for trading if the issuer objects within the allotted time. This prevents listing on the platform concerned under the exemption, but does not constitute a general ban on tokenizing the stock or trading it elsewhere. The platform must also publish a notice containing the required disclosures at least 30 calendar days before starting operations.
The SEC also requires tokenized shares to give holders the same rights and privileges as traditional shares of the same class, and the smart contracts used must be auditable and publicly available. If the primary listing exchange halts trading in the underlying stock, the platform must simultaneously halt trading in its tokenized version. These conditions impose operational limits on the continuous-trading model proposed by OKXICE, since the token cannot continue trading when the underlying market is halted. The SEC said the temporary exemption allows on-chain trading in a licensed environment while the commission considers whether further action is needed. Its chairman, Paul Atkins, called it “a major step forward” in bringing U.S. capital markets into the digital age and urged the public to submit comments to help assess potential changes.
Separately from the company’s objection to this specific platform, a JPMorgan spokesperson said the bank still sees potential in tokenization but would not participate in this venue at this time. The spokesperson added that the bank “will continue to evaluate opportunities as the market develops,” noting the need to think carefully about how its shares are represented and traded. The statement distinguishes reservations about a specific platform from the bank’s position on tokenization technology as a whole. The other notices, according to published information, do not explain the reasons for the issuers’ objections. Andrew Cuomo, co-chair of OKXICE, described the SEC’s limited experiment as “a testing ground, a proof of concept.”
The Securities and Exchange Commission is seeking public comment on potential amendments to the exemption and next steps, while the exemptions expire 5 years after publication of the order. This allows the commission to review the framework during its term, while its implementation remains subject to notice requirements, shareholder rights and trading-halt rules. The SEC said the exemption allows eligible platforms to operate in a licensed environment while it considers whether further action is needed to facilitate on-chain trading. The notice did not set a date for further regulatory action, while the 5-year term remains tied to the order’s publication date. In the meantime, OKXICE’s ability to list each stock remains contingent on its issuer not submitting a qualifying objection by the specified deadline.