NYSE Tests Avalanche for Planned Tokenized Securities Platform

The New York Stock Exchange has spent about a year testing Avalanche for a planned tokenized-securities platform, keeping the blockchain under evaluation as ICE develops infrastructure for on-chain settlement.

The NYSE has assessed how Avalanche could connect with existing trading systems. ICE and Ava Labs have established a cooperation relationship, but neither company has announced Avalanche as the network for the platform.

ICE Vice President of Strategic Initiatives Michael Blaugrund said the company has maintained close contact with the Avalanche team and that the network meets its requirements in many respects.

The evaluation follows the NYSE’s January announcement of plans to develop a platform for trading tokenized U.S. stocks and exchange-traded funds with settlement conducted on a blockchain. ICE and tZERO signed a memorandum of understanding Aug. 31 covering infrastructure for the platform, and ICE’s investment in tZERO was announced Sept. 14. ICE’s investment in tZERO is part of the effort to build infrastructure for tokenized securities and on-chain settlement.

The regulatory backdrop changed Sept. 17, when the U.S. Securities and Exchange Commission issued a temporary, conditional Innovation Exemption for Tokenized Securities Venues. The exemption allows qualifying venues to trade certain tokenized National Market System stocks through permissioned automated market makers and liquidity pools, subject to limits and operating requirements.

Ava Labs President Cooper said some securities venues may begin offering 24-hour weekday trading within the next year. He did not say which exchanges, if any, would adopt that model.

For ICE, Avalanche remains part of an evaluation process. The company has not confirmed a blockchain network for the planned NYSE-affiliated platform.