What Is the Issuer Sponsored Token Coalition Building?
Bullish, Equiniti, Alpaca, Apex Fintech Solutions and DriveWealth have formed an industry coalition aimed at making tokenized stocks function more like the shares investors already own through traditional brokerage accounts.
The Issuer Sponsored Token Coalition, announced Thursday, will work on technical standards, custody, settlement and interoperability between conventional securities infrastructure and blockchain networks. Its central idea is that a tokenized share should remain directly connected to the issuing company’s official shareholder register rather than merely track the economic performance of the stock.
That link matters because it can preserve voting rights, dividends, corporate-action entitlements and other rights attached to legal share ownership.
“The architecture we establish now matters and that is why we are bringing together this group of leading firms to chart the course,” Bullish CEO Tom Farley said.
Bullish already has a financial interest in building that infrastructure. The company agreed in May to acquire shareholder-services provider Equiniti for $4.2 billion, combining a digital-asset trading business with a transfer agent responsible for maintaining corporate shareholder records. The transaction is expected to close in January 2027, subject to regulatory approvals.
Why Does Issuer Sponsorship Matter for Tokenized Stocks?
Not every product described as a tokenized stock represents direct ownership in the company whose share price it follows.
Some structures provide economic exposure through a token or debt instrument while the investor never appears on the company’s shareholder register. That distinction became highly visible this month during the dispute between AMC Entertainment and Robinhood over stock tokens.
AMC CEO Adam Aron objected to products linked to AMC shares that were created without the company’s involvement. Robinhood’s existing offshore stock-token structure gives users price exposure but does not make them legal or beneficial owners of the underlying company shares.
The new coalition is proposing the opposite model: tokenization beginning with the issuer and its official ownership records.
“Tokenization creates an opportunity to connect issuers and investors in ways that weren’t possible with traditional market infrastructure,” said Arush Sehgal, head of digital assets at Alpaca. “Getting it right means preserving shareholder rights and ensuring onchain markets remain connected to the markets they’re built on.”
Alpaca plans to contribute its Instant Tokenization Network, which is designed to allow traditional securities and their tokenized equivalents to move between conventional custody and blockchain infrastructure.
Investor Takeaway
The next competition in tokenized equities may be less about putting stock prices on a blockchain and more about proving what the token legally represents. Products tied directly to issuer records could have an advantage with investors who want blockchain trading without giving up voting, dividend and corporate-action rights.
How Does the SEC’s New Exemption Change the Market?
The coalition is forming one week after the Securities and Exchange Commission opened a new route for tokenized U.S. equities.
On September 17, the SEC granted a five-year conditional Innovation Exemption allowing qualifying Tokenized Securities Venues to support limited onchain trading of National Market System stocks through permissioned automated market makers and liquidity pools.
The decision creates the clearest U.S. regulatory path yet for blockchain-based equity trading. FinanceFeeds previously reported that the SEC exemption could benefit firms including Coinbase and Robinhood as financial companies race to build regulated tokenized-stock products.
Importantly for the coalition’s strategy, qualifying tokenized shares must provide holders with the same rights and privileges as their traditional equivalents. That requirement makes the shareholder register, transfer-agent infrastructure and treatment of corporate actions much more important than simply producing an onchain token backed by stock held elsewhere.
Can Tokenized Stocks Connect to Existing Market Infrastructure?
The technical challenge now moves beyond issuance. Tokenized securities need systems for custody, transfers, settlement, dividends, voting and reconciliation with existing financial-market infrastructure.
Apex Fintech Solutions and DriveWealth bring brokerage and clearing experience to the coalition, while Equiniti provides the shareholder-record infrastructure that connects companies with their investors. The group intends to explore common standards that allow tokenized securities to move between conventional systems and blockchain networks without losing their legal link to the underlying issuer.
Other parts of the market are pursuing the same problem from different directions. The New York Stock Exchange is developing an onchain trading and settlement platform designed to support tokenized stocks and ETFs, while Coinbase, Robinhood, Ondo and other platforms are already expanding blockchain-based equity products.
The coalition therefore is not trying to establish whether tokenized equities will exist. They already do. The unresolved issue is what type of tokenized equity becomes the institutional standard.
If issuers, transfer agents, brokers and blockchain venues converge on a model in which the token itself remains tied to the authoritative shareholder register, the market could move away from products that provide only synthetic economic exposure. That would bring tokenized trading closer to conventional stock ownership while retaining blockchain-based transfer and settlement.
