Walmart, Microsoft and JPMorgan block NYSE-backed venture from tokenizing their shares

Walmart and 37 other companies have objected to third-party tokenized versions of their shares trading on OKXICE, the proposed round-the-clock stock tokens venue backed by the owner of the New York Stock Exchange.

The objections show that a venue can earn trading fees while issuers weigh pricing risks and a limited window to object.

The venue's Oct. 28 notice lists Walmart alongside Microsoft, Alphabet and JPMorgan among 38 objectors.

OKXICE is owned equally by an Intercontinental Exchange subsidiary and OKC USA. ICE operates the NYSE, but OKXICE is a separate venue proposing secondary trading through automated liquidity pools on the XLayer blockchain.

Under the SEC framework, the tokens must carry shareholder rights equivalent to conventional shares.

Oct. 24 reports listed 16 objectors, and the larger roster now sharpens the issuer-participation problem.

The fees go to the trading business

OKXICE's service fee goes to the venue, while separate pool fees accrue to the investors who supply assets for trading, while network fees go to the blockchain.

The SEC's Sept. 17 exemption prohibits primary issuance and initial offerings on covered tokenized securities venues.

An issuer could still value wider access to its shares, but that potential benefit differs from a direct payment or capital raise, and the fee schedule does not quantify an issuer payoff.

More trading can create a clear revenue opportunity for the venue without giving the underlying company an equally clear commercial incentive to participate.

Before offering a stock tokenized by an unaffiliated third party, a venue must notify the issuer. A written objection delivered by the 30th calendar day after the company receives that notice prevents the token from trading on that particular venue.

SEC staff guidance also distinguishes this issuer process from the separate public-notice period before a venue begins operations.

Section II.D of the order specifies no comparable routine issuer veto after the objection window, creating an incentive to refuse early while assessing a venue's risks and benefits.

On Oct. 19, the Securities Industry and Financial Markets Association proposed changes that could include affirmative issuer consent, a longer objection period, and a universal issuer opt-out.

A familiar share can have an unfamiliar price

The SEC identifies shareholder-register maintenance and possible price dislocation, including adverse effects on underlying stock prices, as risks issuers may weigh.

OKXICE's proposed pools price transactions from their asset balances rather than a conventional order book. The venue warns that token prices may diverge from underlying share prices, particularly when regular stock markets are closed, or pool liquidity is thin.

A separate price for a token representing a company's shares can create confusion about what the stock is worth.

OKXICE provides for trading stoppages, including those tied to underlying-stock halts. Beyond its disclosed stoppages, it applies no additional reference-price bands, so round-the-clock availability doesn't guarantee a trader can buy near the conventional share quote.

Canton Strategic Holdings' Oct. 29 announcement shows that the company agreed with tokenized securities venue TSV LLC to make its shares available through an issuer-sponsored arrangement and engaged Fairmint to tokenize them.

Fairmint TA would issue the tokens and maintain the official on-chain ownership record, with trading expected as early as Nov. 2.

Both sponsored and third-party tokens under the SEC framework must provide equivalent shareholder rights. Canton's distinction is that the company chose its intermediaries and ownership-record arrangement.

The 38 objections leave OKXICE with an issuer-participation challenge alongside its technology plans. The practical test is whether broader access can offer companies enough value to accept the pricing and recordkeeping trade-offs, or whether venues will need more arrangements built with issuers from the outset.