Intercontinental Exchange (ICE) (NYSE: $ICE), the parent company of the New York Stock Exchange, has partnered with blockchain infrastructure firm tZERO to build the systems behind its planned market for tokenized securities.
On Monday, the companies announced that tZERO will work with ICE on transfer-agent and broker-dealer infrastructure designed to support the onchain settlement of tokenized securities on ICE’s upcoming NYSE-affiliated digital trading platform.
ICE will also invest in tZERO’s latest funding round and license its portfolio of 103 blockchain patents. The size of the investment was not disclosed.
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Subject to regulatory, technical and operational requirements, tZERO is expected to become an approved digital transfer agent and subscriber to the platform.
The role could put tZERO at the center of how tokenized shares are issued, transferred and recorded. Transfer agents maintain ownership records and process changes when securities change hands.
“tZERO’s experience in regulated on-chain infrastructure makes them a valuable partner as we expand our upcoming digital transfer agent program in support of tokenized securities trading and settlement,” Michael Blaugrund, Vice President of Strategic Initiatives at ICE, said.
As part of the partnership, ICE and tZERO will also explore whether tokenized assets can be used as collateral at ICE clearing houses and other affiliates.
ICE previously selected Securitize in March to serve as a digital transfer agent for its planned tokenized securities platform. Securitize and tZERO are separately engaged in a patent dispute after Securitize sued tZERO in June, seeking a ruling that it had not infringed tZERO’s patents.
The partnership comes as major financial institutions increasingly explore tokenization. Citi has estimated that the tokenized securities market could reach $5.5 trillion by 2030.
ICE shares are currently trading at $159.36 apiece, down around 2% today.
