SpaceX objects to OKX-ICE plan to list tokenized SpaceX shares in the US

SpaceX tells OKXICE no to tokenized shares

SpaceX has objected to plans by OKXICE to list tokenized versions of its shares, according to a Nov. 2 public notice from OKXICE. OKXICE is a joint venture between crypto exchange OKX and Intercontinental Exchange (ICE), the parent company of the New York Stock Exchange.

The objection comes months after tokens tied to SpaceX shares became one of the biggest drivers of onchain stock trading. SpaceX now joins Tesla and Amazon among 56 companies that have objected to the proposed listings.

The key facts

• OKXICE published the SpaceX objection in a public notice dated Nov. 2.
• The venue is a joint venture of OKX and ICE.
• 56 companies, including Tesla and Amazon, have now objected to proposed tokenized listings.
• Tokenized SpaceX shares already trade outside the US, where they drew large volumes in June.

How companies can block tokens under the SEC exemption

In September, the US Securities and Exchange Commission introduced a five-year Innovation Exemption. It lets platforms such as OKXICE offer trading in tokenized versions of US stocks without registering as national securities exchanges.

The framework also gives companies a say. Companies have 30 days to object to third parties tokenizing their shares, and an objection effectively keeps those tokens off the venue.

Tokenized stocks are blockchain-based representations of company shares that let investors get exposure to traditional equities onchain, often around the clock. Depending on how they are structured, they can be backed by actual shares, but the rights given to tokenholders may differ from those of traditional shareholders.

Offshore trading was already large before the objection

Ahead of the SpaceX listing, Backpack Securities, a brokerage and tokenization platform, and crypto exchange Kraken, through its xStocks offering, both prepared tokenized versions of the aerospace company's stock, each designed to be backed by actual shares.

Backpack's SPCX token recorded $1.08 billion in onchain trading volume in June. Kraken's SPCXx token recorded $852 million over the same month.

Unlike Backpack and Kraken, OKXICE would open tokenized stock trading to US investors under the SEC framework. That could reach the world's largest equity market by capitalization and widen the investor base for tokenized securities.

Nasdaq's warning and Cuomo's response

Nasdaq warned issuers in September that they "must be cautious about their participation" in the venture. Nasdaq argued that tokenized stock trading could fragment liquidity and undermine long-term shareholder value.

OKXICE co-chair and former New York Governor Andrew Cuomo told Cointelegraph on Oct. 20 that the venture expected more objections, as companies avoided being the first to test the model. At an Oct. 30 press conference, Cuomo said that as people see the benefits of tokenization, "you'll see more and more companies participate."

What is confirmed and what is not

Confirmed by the supplied material: OKXICE published a public notice on Nov. 2 stating SpaceX objected to the proposed listing, and the count of objecting companies stands at 56, including Tesla and Amazon. The June trading volumes for Backpack's and Kraken's tokens are also reported as figures.

Not confirmed by the supplied material: SpaceX's specific reasons for objecting, and whether any other companies plan to object. Whether the Innovation Exemption will be extended or changed is also not addressed.

Why the dispute matters for tokenized stocks

The case shows how the SEC's exemption works in practice. A company can stop a third party from listing a token tied to its shares on a US venue, even when similar tokens already trade offshore. That limits how far US-based tokenized equity trading can grow if issuers keep objecting.

Sources

• Cointelegraph