Bullish, Equiniti, Alpaca, Apex Fintech Solutions and DriveWealth have formed the Issuer Sponsored Token Coalition, an industry group dedicated to building technical standards for tokenized securities that remain directly tied to the companies that issue them.
The coalition was unveiled Thursday and convened by CoinDesk parent company Bullish and Equiniti, a shareholder-services and market-infrastructure firm currently being acquired by the crypto platform.
The group said it will work on technical standards, settlement, custody arrangements and methods for moving securities between traditional market infrastructure and blockchain networks. Its primary focus is issuer-sponsored tokenization, a model in which a tokenized share is linked to a company’s official shareholder register, preserving voting rights, dividends and participation in corporate actions.
The effort comes as brokers, issuers and regulators debate the distinction between tokenized shares and synthetic products that only track the price of an underlying asset without conferring direct ownership.
The issue surfaced publicly last week during a dispute between AMC Entertainment CEO Adam Aron and Robinhood over whether synthetic or tokenized products may leave investors with economic exposure to a stock but without the legal rights of registered shareholders. Issuer-sponsored models aim to narrow that gap by tying the token directly to the issuer’s records.
“The architecture we establish now matters and that is why we are bringing together this group of leading firms to chart the course,” said Tom Farley, CEO of Bullish.
Alpaca said it plans to contribute to interoperability between traditional securities and onchain markets through its Instant Tokenization Network. “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.”
Apex Fintech Solutions, which provides infrastructure for broker-dealers and other financial firms, said the coalition could help establish standards enabling tokenized markets to connect with existing systems.
The group’s formation follows a U.S. Securities and Exchange Commission exemption last week allowing limited onchain trading of U.S.-listed equities under certain conditions.
