Only months after tokenized versions of its shares became one of the biggest drivers of onchain stock trading, SpaceX is moving to block similar trading from reaching US investors. The move places the rocket company at the center of a widening dispute between issuers and tokenization platforms.

According to a Nov. 2 public notice from OKXICE, the aerospace company has objected to the proposed listing of tokenized versions of its shares on the venue — a joint venture between crypto exchange OKX and Intercontinental Exchange (ICE), the parent company of the New York Stock Exchange. SpaceX now joins Tesla and Amazon among the 56 companies that have objected to the proposed listings.

The venue operates under the Securities and Exchange Commission's five-year Innovation Exemption, introduced in September. The framework allows platforms such as OKXICE to offer trading in tokenized versions of US stocks without registering as national securities exchanges, but it also gives companies a say in the process: issuers have 30 days to object to third-party tokenization of their shares, effectively keeping those tokens off the venue.

What tokenized stocks are

Tokenized stocks are blockchain-based representations of company shares that allow investors to gain exposure to traditional equities onchain, often around the clock. Depending on their structure, they may be backed by actual shares, though the rights granted to tokenholders can differ from those of traditional shareholders.

OKXICE co-chair Andrew Cuomo, the former New York governor, told Cointelegraph on Oct. 20 that the venture expected more objections as companies avoided being the first to test the model.

Booming offshore trading

SpaceX's objection comes despite tokenized versions of its shares already trading on platforms outside the US, where they have attracted significant activity since the company's June public offering. Ahead of the listing, Backpack Securities, a stock brokerage and tokenization platform, and crypto exchange Kraken, through its xStocks offering, each prepared tokenized versions of the aerospace company's stock, designed to be backed by actual shares. Backpack's SPCX token went on to record $1.08 billion in onchain trading volume in June, while Kraken's SPCXx token recorded $852 million.

Unlike Backpack and Kraken, OKXICE would open tokenized stock trading to US investors under the SEC's new regulatory framework, potentially tapping into the world's largest equity market by capitalization and expanding the investor base for tokenized securities. SpaceX's objection, however, means its tokenized shares would be absent from that US-facing lineup, even as offshore versions continue to trade.

Nasdaq warned issuers in September that they “must be cautious about their participation” in the venture, arguing that tokenized stock trading could fragment liquidity and undermine long-term shareholder value.

Despite the growing opposition, Cuomo said during an Oct. 30 press conference that as people see the benefits of tokenization, “you'll see more and more companies participate.” The tension between that outlook and the 56 objections already on file will shape how much of the US equity market tokenization platforms can reach under the exemption.