Detailed Explanation of the NYSE's Tokenized Securities Platform: Why Trade 24/7

Author: Cookie

On January 19, according to official news, the ICE Group's New York Stock Exchange announced today that it is developing a platform for tokenized securities trading and on-chain settlement, and will seek regulatory approval for this.

The NYSE's new digital platform will support a tokenized trading experience, including 24/7 operation, instant settlement, ordering by dollar amount, and fund transfers based on stablecoins. Its design integrates the NYSE Pillar matching engine with a blockchain-based post-trade system, capable of supporting multi-chain settlement and custody.

Lynn Martin, President of ICE Group, stated plainly: "We are leading the industry towards a fully on-chain solution while maintaining the unparalleled protection and high regulatory standards of the NYSE." In other words, they aim to enhance efficiency with blockchain while continuing to earn the trust of Wall Street.

Currently, the plan is still in the early development stage and has not been built or undergone comprehensive testing. The NYSE stated that it will seek approval from regulatory bodies such as the U.S. Securities and Exchange Commission (SEC), with the platform expected to launch later in 2026.

The first reaction from crypto players might be, "Oh no, the regular army is about to enter the market on a large scale." The narrative of trading U.S. stocks on-chain will be completely taken away; what will we have left? In fact, the on-chain transformation of traditional securities markets is not a trend that emerged only after the significant advancement of cryptocurrency compliance last year; it has existed for a long time. When we take a closer look at the past and present of traditional securities on-chain transformation in the U.S. and globally, we will find that this is an unstoppable and ongoing trend. Anxiety is reasonable, but there should be more confidence.

In the U.S., the NYSE is actually racing against Nasdaq

Compared to the NYSE's preliminary announcement of its on-chain plan, Nasdaq submitted a formal proposal to the SEC last year.

On September 8, 2025, Nasdaq submitted proposal SR-NASDAQ-2025-072 to the SEC, aiming to amend rules to allow trading of tokenized securities on the Nasdaq market and integrate blockchain technology for settlement and clearing. The proposal emphasizes that blockchain can bring faster settlement, improved audit trails, and a smoother order-to-settlement process.

If approved, this feature is expected to be available by the end of the third quarter of 2026. The proposal has entered the SEC review phase, and a revised version (Amendment No. 1) was submitted on December 29, 2025.

In comparison, the NYSE seems to be lagging behind Nasdaq, but the NYSE's new plan is not a hasty response to Nasdaq; rather, it is a continuation of ICE's long-term blockchain strategy.

As early as 2015, ICE began exploring blockchain technology and launched the Bakkt platform in 2018 (focusing on crypto futures and custody). In 2021, the platform went public on the NYSE through a merger with VPC Impact Acquisition Holdings.

In August last year, ICE partnered with Chainlink to provide foreign exchange and precious metals rate data on-chain through Chainlink. In October, ICE announced a strategic investment in Polymarket, with an investment amount of up to $2 billion. At the end of last year, there were also reports that ICE was in talks to invest in MoonPay.

Notably, the on-chain reform proposals from the NYSE and Nasdaq differ.

Nasdaq's plan adopts a "hybrid model," allowing traders to choose between traditional or tokenized forms (using blockchain) for settlement when entering orders, with all trades executed on the same order book, using the same CUSIP identifiers, execution rules, and priorities. Clearing and settlement are handled through DTC, with tokenization serving only as an optional "digital representation," not altering the existing structure (such as the T+1 settlement cycle).

In other words, Nasdaq is not creating a brand new, independent on-chain securities trading platform, but rather integrating tokenized securities into the existing system, emphasizing compatibility with the current system, minimizing disruption to existing infrastructure, and avoiding the creation of new risks. Although reports at the end of last year indicated that Nasdaq was seeking approval to allow the market to trade five days a week, 23 hours a day, it remains a gradual and moderate reform.

The NYSE's plan is evidently more aggressive; they aim to create a brand new, independent on-chain securities trading platform. ICE is collaborating with banks such as BNY Mellon and Citigroup to support tokenized deposits in its clearinghouse, helping clearing members transfer and manage funds outside traditional banking hours, fulfill margin obligations, and adapt to the funding needs of different jurisdictions and time zones.

This breaks free from the limitations of traditional bank clearing windows that are only open on weekdays. For the NYSE, T+0, 24/7 trading, fractional trading, and support for stablecoin funding are all essential, representing a more profound transformation compared to Nasdaq.

Globally, the exploration of securities tokenization and even asset tokenization has long begun and is thriving. Examples include Switzerland's SIX Digital Exchange (SDX), Germany's Deutsche Börse D7 platform, the UK's Archax, and Singapore's DBS Bank Digital Exchange. However, a reform plan as aggressive as that of the NYSE is still unprecedented.

The race between the NYSE and Nasdaq is not merely about "earning more fees," but both are proactively responding to the new landscape of global competition in the traditional securities trading market. Like Nasdaq, the NYSE's securities trading platform NYSE Arca has also submitted a proposal to extend trading hours and is awaiting formal approval, which is set for 2024.

The London Stock Exchange (LSE) and Asian exchanges (such as Tokyo or Hong Kong) are also exploring extended trading hours.

For traditional exchanges, extending trading hours is not as simple as it appears to be "just a few more hours of trading." There are many technical changes involved, such as closing prices, ex-rights, ex-dividends, etc., and they also face potential challenges regarding network stability. On the brokerage side, upgrades must be made to keep up with these changes.

Historically, extending trading hours has been a trend that has never ceased, accompanied by technological advancements. For example, in the U.S., from the 1920s to the 1940s, the daily trading time in the securities market was about 5 hours, rising to about 6 hours in the 1950s to 1970s, about 6.5 hours in the 1980s to 1990s, and reaching about 16 hours in the 21st century.

According to a report by Deloitte, as of June 2023, foreign investors held $26.86 trillion in U.S. securities. One reason for extending trading hours is undoubtedly to better accommodate and attract foreign investors.

Kevin Tyrrell, an executive at the NYSE, stated in an interview with CNBC, "Whether in the U.S. or globally, the interest of retail and institutional investors in U.S. stocks continues to grow. Our proposed 22-hour/5-day extended trading plan is based on multiple communications with market participants and our own data and analysis. Given the current level of investor demand and the availability of existing market infrastructure, we believe that the 22-hour/5-day extended trading plan is the right approach."

For international companies looking to go public, they want to enter the most liquid U.S. stock market in the world. If either the NYSE or Nasdaq supports around-the-clock trading, they would be more inclined to choose the one that supports it, as it is more time-friendly.

Although exchanges are aware of the risks and upgrade costs that around-the-clock trading may bring, the never-ending, long-running cryptocurrency market's appeal to global users has become their best "teacher." Whether it is extending trading hours or improving trading and settlement efficiency, embracing global investors is something they must strive to achieve. Traditional securities have not remained "traditional"; they have been evolving.

Impact on Traditional Markets

Support for fractional trading undoubtedly further lowers the entry threshold for retail investors. One significant advantage of cryptocurrencies over traditional stock markets is that even if Bitcoin rises to $1 million each, retail investors can still buy just $10 worth. However, if the NYSE's vision is ultimately realized, everyone could also buy $10 worth of giants like Nvidia, Tesla, or Apple.

24/7 trading and T+0 settlement will greatly accelerate the market pace of traditional stock markets. On the positive side, settlement risks and cross-timezone friction will be significantly reduced, and the flexibility of investment and the efficiency of price discovery will be greatly improved.

However, risks also exist. More severe volatility and more emotional trading, a non-stop market could lead to liquidity fragmentation and more price manipulation. Especially during the closing period of traditional securities markets, on-chain could become a "paradise" for "bad actors" and insider trading.

Due to changes in trading and settlement mechanisms, traditional institutions and market makers' strategies may also enter a competitive upgrade phase, similar to what the NYSE and Nasdaq are experiencing. Faced with increasingly upgraded information monitoring and automated trading strategies, it is difficult to say whether this progress means more opportunities or harsher competition for retail investors.

Which Cryptocurrency Projects Have Potential Benefits

Although the NYSE's announcement mentioned that it "will support multi-chain settlement and custody," there are currently no further details indicating whether this includes public chains like Ethereum or Solana. If it does, it would undoubtedly be a significant benefit for public chain tokens.

When on-chain stablecoins can directly enter U.S. stock targets through the NYSE, the probability of a resurgence of altcoin seasons in the crypto space will shrink in the short term. The reason it is termed "short-term" is that the demand for on-chain stablecoins to enter U.S. stocks has never been met; once the door is opened, there will certainly be a significant siphoning effect in the short term.

However, over the years, the crypto space has also cultivated a group of investors with distinct characteristics, and the overall investment environment in the crypto space is quite different from that of the stock market. Whether investors will choose stability or the dream of a hundredfold or thousandfold return remains to be observed over the long term.

For crypto projects like AAVE and Compound that provide stablecoin lending, the NYSE's plan is akin to "a narrative from the heavens." For projects like Ondo that previously aimed to bring U.S. stocks on-chain, they will experience painful transformations.

For the crypto market, it is about to face unprecedented challenges from the traditional securities market. For the crypto industry, this represents another milestone advancement of blockchain technology in traditional financial markets.

Does this mean that the future of the crypto market is becoming increasingly bleak? I believe not. I am confident that with the overall progress of the industry, the future trend of "tokenization of everything" is unstoppable, and securities are just one of many. The crypto market will continue to be a place where miracles happen; I believe in the future.