NYSE taps Avalanche for clearing and settlement of tokenized securities

Avalanche (AVAX) defied the crypto market drawdown on Monday, up 4% after announcing it will provide the core ledger technology for clearing in the New York Stock Exchange's (NYSE) upcoming tokenized securities trading platform.

Avalanche set to power clearing and settlement for NYSE-affiliated tokenized securities platform

Ava Labs, the development firm behind Avalanche, announced Monday that the blockchain will underpin the clearing infrastructure of the NYSE-affiliated digital alternative trading system (ATS). The platform is being developed to support 24/7 trading, clearing and settlement of tokenized securities, subject to regulatory approvals.

NYSE Head of Digital Issuance Dennis Lee said the exchange is selecting different technologies for different parts of its digital market infrastructure.

"At the NYSE, we're looking at how blockchain technology can expand what we offer in equities, and we're picking the right technology for each job," Lee said.

He noted that the ledger responsible for recording and settling trades must offer speed, reliability, predictable operating costs and the ability to control network participation.

Ava Labs founder and CEO Emin Gün Sirer also stated that traditional financial markets have operated for decades on infrastructure built around fixed trading hours and delayed settlement.

"For decades, financial markets have operated on infrastructure designed around fixed trading hours and delayed settlement. There is no longer a technical reason for these constraints to exist,” Sirer wrote in an X post on Monday.

He described Avalanche's selection for the NYSE-affiliated platform as a significant development for the technology.

However, NYSE's tokenized platform is expected to support equities listed across multiple blockchain networks, meaning the assets traded on the platform will not be limited to those issued on Avalanche.

NYSE advances plans for tokenized securities trading

The development follows the NYSE's January announcement that it was building a digital platform for trading and onchain settlement of tokenized securities.

The proposed platform is designed to introduce several changes to traditional equity markets, including 24-hour trading and support for stablecoin-based funding.

In March, the NYSE announced a partnership with digital asset firm Securitize to develop infrastructure for issuing and managing tokenized securities. Securitize was selected as the first eligible digital transfer agent for the planned platform.

The initiative forms part of a broader strategy by NYSE parent company Intercontinental Exchange (ICE) to connect traditional financial markets with blockchain-based trading infrastructure.

In March, ICE expanded its digital asset partnerships through an agreement with crypto exchange OKX. The partnership included plans to give the exchange's users access to ICE-operated futures and NYSE tokenized equities markets.

Similarly, ICE partnered with Trade[XYZ] to bring Hyperliquid-based perpetual futures markets covering equities, commodities, foreign exchange and cryptocurrencies into the US.

AVAX is trading at $8.65, up 5.7% in the past 24 hours at the time of writing.