OKX and Intercontinental Exchange (ICE) are facing growing opposition to their planned tokenized stock exchange, with 33 major U.S. companies now objecting to having their shares listed.
The latest objections came from JPMorgan Chase, AMD, Applied Materials, Coca-Cola, Adobe, Dell Technologies, and SanDisk. Will OKXICE be able to launch their platform?
On 5 October, OKX and ICE submitted a proposal under a five-year SEC innovation exemption to launch their joint trading platform, OKXICE. The platform initially planned to offer 63 U.S. stocks as tokens.
Under the rules, OKXICE must inform each company in writing before listing its stock as a token. Companies then have 30 days to object. If they do, OKXICE cannot offer their stocks as tokens under this exemption.
Until now, 33 major US companies have opposed having their stocks tokenized on OKX and ICE’s planned exchange. The latest group includes JPMorgan Chase, Coca-Cola, Advanced Micro Devices (AMD), Applied Materials, Adobe, Dell Technologies, and SanDisk.
They join earlier objectors such as Microsoft, Alphabet, Goldman Sachs, Wells Fargo, IBM, Intel, and Oracle.
Tokenized stocks are digital tokens that represent shares in companies. They could let investors buy and sell these tokens at any time, including weekends, using blockchain platforms.
One concern is that some companies do not want their shares traded on platforms they do not control. They also worry that investors may confuse these tokens with actual shares approved by the companies.
Applied Optoelectronics previously raised concerns about investor confusion and the possible effects on its share price, liquidity, and volatility. It also questioned whether the potential benefits were worth the risks.
The objections may not stop the project, but they could leave fewer stocks available when the platform launches. Companies that have not objected may still be included, subject to regulatory approval.
So far, companies worth $17 trillion in total stock market value have rejected the plan to tokenize their shares.
The main challenge for OKX and ICE is now to attract enough companies and traders to make the platform successful.
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