Formation Securities plans Solana stock trading venue under SEC exemption

Formation Securities, a newly established company licensing technology from decentralized exchange Orca, has notified the US Securities and Exchange Commission (SEC) of plans to launch a tokenized stock trading venue on Solana in early 2027.

The company said Monday that tokenized shares of Galaxy Digital, Exodus Movement and Forward Industries are expected to be available at launch. The venue would operate under the SEC’s temporary Innovation Exemption announced in September, which allows verified investors to trade certain US-listed shares around the clock while retaining voting, dividend and other shareholder rights.

Superstate and Securitize are expected to make tokenized shares available on the marketplace, which Formation says it intends to develop in cooperation with public companies. The venue would use automated market maker (AMM) technology, allowing investors to hold securities in their own wallets and settle trades onchain against stablecoins and other eligible assets.

Traditional transfer agents would continue to maintain official shareholder records, preserving companies’ direct relationships with shareholders.

Solana is already among the largest blockchains for tokenized equities, with approximately $575 million in tokenized stock value as of Monday, compared with $747 million on Ethereum and $1.7 billion on BNB Chain, according to RWA.xyz data.

Related: Robinhood’s Tenev warns US tokenization uncertainty deters ‘serious assets’

Tokenized stock plans draw issuer concerns

Formation’s issuer-focused approach comes amid growing debate over how publicly traded shares should be brought onchain. As of early November, more than 50 companies had objected to having their shares tokenized on OKXICE, a proposed venue backed by crypto exchange OKX and New York Stock Exchange parent Intercontinental Exchange.

Under the SEC’s Innovation Exemption, trading venues must notify issuers in writing and wait at least 30 calendar days before trading shares tokenized by unaffiliated third parties, giving companies an opportunity to object. Nasdaq warned in September that tokenized stock trading could have unforeseen consequences for liquidity, price discovery and long-term shareholder value.

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