33 large American companies oppose the tokenization of their stocks on the proposed OKX-ICE exchange.
JPMorgan Chase, Coca-Cola, AMD, Adobe, Dell Technologies, Applied Materials, and SanDisk are all among those opposed to it.
These objections may limit the range of stocks available on the platform in its initial phase, but OKX-ICE may still proceed with listing arrangements for eligible candidates.
The tokenized stock exchange proposed by OKX and Intercontinental Exchange ( ICE ) is facing increasing opposition. Currently, 33 large American companies have opposed the listing of their stocks on this platform.
The latest companies to express opposition include JPMorgan Chase, AMD, Applied Materials, Coca-Cola, Adobe, Dell Technologies, and SanDisk. The report raises questions: Will OKXICE still be able to successfully launch its platform?
JPMorgan Chase, Coca-Cola, AMD oppose tokenized stock plans
On October 5th, OKX and ICE submitted a proposal based on a five-year innovation exemption from the U.S. Securities and Exchange Commission (SEC), planning to launch a joint trading platform OKXICE. The platform was initially intended to offer 63 U.S. stocks in the form of tokens.
According to relevant regulations, OKXICE must notify the company in writing before listing the company's shares in the form of tokens. The company then has 30 days to raise any objections. Once the company raises an objection, OKXICE cannot provide the company's stock tokens under this exemption.
As of now, 33 large American companies have opposed the tokenization of their stocks on the proposed exchanges OKX and ICE. The latest group of opponents includes JPMorgan Chase, Coca-Cola, Supermicro Semiconductor (AMD), Applied Materials, Adobe, Dell Technologies, and SanDisk.
They joined the ranks of companies that had previously expressed opposition, including Microsoft, Alphabet, Goldman Sachs, Wells Fargo, IBM, Intel, and Oracle.
Why Do Companies Say "No" to Tokenization?
Tokenized stocks are digital tokens that represent shares of a company. They allow investors to buy and sell these tokens at any time through blockchain platforms, including on weekends.
One concern is that some companies do not want their stocks to be traded on platforms that are not under their control. They are also worried that investors might confuse these tokens with the actual stocks that have been approved by the companies.
Applied Optoelectronics Previously mentioned that investors' confusion about risks, as well as the potential impacts on their stock price, liquidity, and volatility, are issues that warrant concern. The company also questions whether the potential returns are worth taking on such risks.
Can the platform with OKX-ICE still be launched?
These objections may not necessarily prevent the project from proceeding, but they could mean that a smaller number of shares will be available when the platform goes live. Companies that have not yet raised objections may still have their shares included, provided that they obtain regulatory approval.
As of now, companies with a total market value of $17 trillion have rejected plans to tokenize their stocks.
For OKX and ICE, the current main challenge is to attract enough companies and traders in order for the platform to be successful.
Credit: Report by CoinPedia.
