Key Points
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Solana-Based Stock Trading: Formation Securities has notified the SEC of plans to launch a tokenized securities trading venue on Solana in early 2027, initially featuring shares of Galaxy Digital, Exodus Movement and Forward Industries.
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24/7 Trading Under SEC Exemption: The proposed platform intends to operate under the SEC’s temporary Innovation Exemption, allowing eligible investors to trade certain tokenized US-listed shares around the clock while retaining shareholder rights.
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Growing Tokenized Equity Market: Solana already hosts approximately $575 million in tokenized stock value, positioning it among the major blockchain networks competing for a larger share of the emerging tokenized securities market.
Formation Securities Targets Tokenized Stock Trading on Solana
Formation Securities is preparing to introduce a blockchain-based stock trading venue on Solana, marking another development in the growing integration of traditional securities markets with decentralized financial infrastructure. The newly established company has notified the US Securities and Exchange Commission (SEC) of its intention to launch the platform in early 2027, with plans to offer tokenized shares and enable continuous trading.
The proposed marketplace will initially include tokenized shares of Galaxy Digital, Exodus Movement and Forward Industries. Formation intends to operate under the SEC’s temporary Innovation Exemption, introduced in September, which establishes a framework for certain tokenized US-listed securities to trade around the clock while preserving traditional shareholder rights.
The initiative reflects increasing interest in blockchain-based securities infrastructure as financial companies explore alternatives to conventional trading and settlement arrangements.
Automated Market Makers Enable Onchain Stock Trading
Formation’s proposed platform will use automated market maker (AMM) technology, a mechanism commonly associated with decentralized cryptocurrency exchanges.
The company is licensing technology from Orca, a decentralized exchange operating on Solana. Through the proposed structure, investors would be able to hold tokenized securities in their own wallets and execute transactions directly onchain.
Trades would settle using stablecoins and other eligible digital assets, potentially reducing reliance on conventional intermediaries involved in traditional securities transactions.
Superstate and Securitize are expected to provide tokenized shares for the marketplace. Formation also intends to collaborate directly with publicly traded companies, an approach that could help address concerns about unauthorized tokenization and issuer relationships.
Importantly, traditional transfer agents would continue maintaining official shareholder records, preserving companies’ direct relationships with their investors.
SEC Innovation Exemption Creates New Market Opportunities
The proposed trading venue is expected to operate under the SEC’s temporary Innovation Exemption, which provides a regulatory pathway for certain tokenized securities trading arrangements.
The framework allows verified investors to trade eligible US-listed shares continuously while retaining voting rights, dividend entitlements and other shareholder protections.
However, the exemption also establishes procedures designed to protect publicly traded companies. Trading venues must notify issuers in writing and wait at least 30 calendar days before trading shares tokenized by unaffiliated third parties, allowing companies an opportunity to object.
This requirement is particularly relevant as some publicly traded companies have expressed concerns about how their shares are represented and traded through third-party blockchain platforms.
Solana Competes in the Expanding Tokenized Equity Market
Solana is already developing a significant presence in tokenized equities. According to RWA.xyz data cited in the report, the blockchain hosted approximately $575 million in tokenized stock value as of Monday.
Ethereum recorded approximately $747 million, while BNB Chain led the comparison with approximately $1.7 billion.
These figures illustrate the competitive environment facing blockchain networks seeking to attract tokenized financial assets and institutional participation.
Formation’s proposed use of Solana’s existing decentralized exchange infrastructure could strengthen the network’s position, particularly if its marketplace attracts publicly traded companies and established tokenization providers.
Issuer Resistance Remains a Significant Challenge
Despite growing interest in tokenized securities, issuer participation remains a central obstacle.
More than 50 companies had reportedly objected to having their shares tokenized on OKXICE, a proposed marketplace backed by cryptocurrency exchange OKX and Intercontinental Exchange, the parent company of the New York Stock Exchange.
Nasdaq has also warned that tokenized stock trading could create unforeseen consequences for liquidity, price discovery and long-term shareholder value.
These concerns highlight the distinction between creating a digital representation of a publicly traded share and establishing a legally and operationally recognized securities trading system.
Formation’s intention to work directly with public companies could therefore become an important differentiator as the market develops.
Outlook: Tokenization Moves Closer to Traditional Financial Markets
Formation Securities’ planned launch represents another step toward integrating blockchain infrastructure with established securities markets. The combination of continuous trading, self-custody and onchain settlement could introduce greater flexibility into how eligible investors access traditional equities.
However, the platform’s success will depend on regulatory implementation, issuer participation, market liquidity and investor confidence in the underlying securities structure.
As the planned early 2027 launch approaches, Formation’s ability to secure participating companies and establish reliable trading infrastructure will be important indicators of whether tokenized equities can move beyond experimental products into a more established segment of financial markets.
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