The New York Stock Exchange announced Tuesday it's working with digital asset company Securitize to develop a platform for trading blockchain-based versions of traditional stocks and bonds. The partnership aims to convert traditional securities into digital tokens that can be traded on blockchain technology.

The New York Stock Exchange revealed Tuesday it has formed a partnership with digital asset firm Securitize to build a platform for trading blockchain-based versions of conventional financial securities.
Under the arrangement, Securitize will become the initial digital transfer agent authorized to produce blockchain-based securities for companies and exchange-traded funds on a forthcoming NYSE-connected Digital Trading Platform, according to the announcement.
The collaboration will see NYSE working alongside Securitize as a design partner to build a digital transfer agent program designed to establish a system for processing tokenized securities transactions on blockchain technology.
Major American exchanges including NYSE and competitor Nasdaq are increasing their initiatives to transform assets such as stocks, bonds and funds into blockchain-based digital tokens.
The tokenization process involves transforming physical assets into digital tokens that exist on a blockchain, which functions as a distributed, secure digital record of transactions.
Earlier in March, the Securities and Exchange Commission gave approval to a Nasdaq proposal permitting specific stocks to be traded and settled in tokenized format, based on regulatory documents.
“As we explore how tokenization can enhance capital markets, it is critical that new infrastructure is developed in a way that preserves the trust, transparency, and protections investors expect” NYSE President Lynn Martin said.
The two companies will additionally work together on establishing standards for digital transfer and tokenization agents, covering regulatory, operational and technology specifications for institutional-level infrastructure.
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