NYSE Evaluates Avalanche Technology

The New York Stock Exchange has spent roughly a year testing Avalanche (AVAX) technology as it develops infrastructure for tokenized U.S. stocks and exchange-traded funds, Ava Labs President Charley Cooper said Thursday.

Tokenization refers to representing traditional securities, such as stocks and exchange-traded funds, as digital tokens recorded on a blockchain, so that ownership and transfers are tracked onchain.

Cooper disclosed the testing during an appearance at the Avalanche Summit in New York. He said NYSE evaluated both the network’s technical performance and its underlying economics while considering how the blockchain could fit into existing market systems.

“They weren’t just kicking the tires on our technology,” Cooper said. “They wanted to make sure that we understood their business and their economics.”

Cooper described a close working relationship between Ava Labs and NYSE but stopped short of declaring that Avalanche had been selected. “I leave it to the NYSE guys to talk publicly about where they are in the whole process,” he said.

Michael Blaugrund, head of strategic initiatives at Intercontinental Exchange (ICE), appeared alongside Cooper and said the parent company of NYSE had remained “very engaged” with the Avalanche team while evaluating blockchain networks. “Avalanche checks a lot of those boxes,” Blaugrund said.

NYSE has not publicly identified the blockchain or blockchains that would power its planned digital securities venue. Its proposed architecture is designed to support multiple networks for settlement and custody.

The exchange first disclosed plans for the digital trading platform in January. NYSE President Lynn Martin said in August that work on onchain settlement infrastructure was continuing. The venue is intended to combine NYSE’s Pillar matching engine with blockchain-based post-trade infrastructure. Subject to regulatory approval, it would support tokenized versions of listed securities as well as assets issued natively onchain.

The proposed platform would include continuous trading, immediate settlement, fractional shares, dollar-denominated orders and stablecoin-based funding. Holders of tokenized shares would retain conventional shareholder rights, including and governance rights.

ICE agreed in late August to invest in tZERO and license its blockchain patents. The agreement followed a March memorandum with Securitize, which is NYSE’s first named digital transfer agent.

A video of Cooper’s appearance at the Avalanche Summit in New York was posted by The Block on X: https://x.com/TheBlockCo/status/2100603819696484564?s=20

SEC Relief and a 24-Hour Trading System

The remarks were circulated through Avalanche’s official X account on September 17 and form part of a broader ICE project: a regulated alternative trading system, or ATS, separate from the main exchange, that is designed to allow stocks and ETFs to trade as tokens around the clock.

Blaugrund said in January that developing infrastructure for onchain trading, settlement, custody and funding was a strategic priority for ICE. The ATS project is therefore not new. What is new is the public identification of Avalanche as a leading candidate for the system’s underlying technology.

Blaugrund’s comments describe an evaluation stage only. Neither ICE nor NYSE has announced a formal contract or a final adoption decision involving Avalanche. The companies have also not disclosed a launch date or an investment amount related to the potential use of the network.

The regulatory backdrop changed this week when the U.S. Securities and Exchange Commission granted eligible venues conditional five-year relief to trade tokenized National Market System stocks through permissioned automated market maker pools, in which participation is restricted to approved participants. The conditions cover shareholder rights, smart contracts, trading limits and coordinated market halts.

Cooper said he expects some trading venues to begin offering 24-hour weekday access within the next year. He did not predict that the largest exchanges, including the LSEs, NYSEs and CMEs, would move on the same timetable. Smaller venues competing for liquidity, he said, could act more quickly.

Avalanche has also gained roles in several tokenization projects. In July, Japanese tokenization platform Progmat migrated every active security-token project it manages, representing more than ¥452 billion in underlying assets, from Corda 5 to a dedicated Avalanche Layer 1 compatible with the Ethereum Virtual Machine.

South Korea’s Hanwha Investment & Securities has completed a tokenized-securities platform supporting Avalanche and Hyperledger Besu ahead of the country’s regulated framework for blockchain securities, which is scheduled to arrive in February 2027.

Charles Schwab is also set to add Avalanche to its Schwab Crypto platform, which has 39.9 million accounts, according to the source report. The development would expand Avalanche’s presence in the brokerage sector, although it is separate from NYSE’s evaluation of the network.

Avalanche’s Potential Role in the NYSE Architecture

Blaugrund provided additional detail about how Avalanche could fit into the proposed venue. He said ICE is evaluating whether the network can serve as the underlying chain for the trading and onchain settlement engine as the company moves toward the expected launch of its regulated ATS.

According to Blaugrund, the technology and engineering teams at ICE and Avalanche are working “very closely” together. He nevertheless stopped short of guaranteeing that Avalanche would be selected.

One potential advantage is Avalanche’s support for customized Layer 1 networks. NYSE could create its own Layer 1 and establish operating rules tailored to the venue, including embedded know-your-customer procedures. Such an arrangement could help organize compliance requirements for onchain securities trading, although NYSE has not announced that it will use this structure.

As the world’s largest stock exchange by the market value of its listed companies, NYSE manages more than 2.5 billion shares and processes over 500 billion messages. The exchange has described its tokenization platform as a key component of its broader digital strategy.

Avalanche’s official post carrying Blaugrund’s remarks is available on X: https://x.com/avax/status/2100659171997766131?s=20

The disclosures indicate that NYSE has conducted extended due diligence on Avalanche while ICE continues to assess blockchain infrastructure for a regulated, around-the-clock equities venue. They do not establish that Avalanche has been chosen. The network’s role remains under evaluation, with no announced contract, launch date or disclosed investment size. Developments that would clarify the picture include NYSE’s public identification of its chosen network or networks, regulatory approval for the venue, and the first operational use of the SEC’s conditional relief.

AVAX spot was reported to have gained 6.8% over the preceding 24 hours as of 00:43 UTC. The source article was published by Coinotag: https://en.coinotag.com/nyse-tested-avalanche-avax-technology-for-a-year-ava-labs-says