The New York Stock Exchange (NYSE) is focused on integrating blockchain technology into existing market infrastructure rather than replacing it, according to Jon Herrick, chief product officer.
The exchange “strives for interoperability” and “builds on what’s out there,” exploring how tokenized assets could work in current systems, Herrick said.
This approach reflects a broader view on market developments. “You have to be aware of the inherent benefits of the market that has developed so far… it’s this balance of the two things,” he said at the Digital Asset Summit in New York on Thursday, referring to the need to preserve things like regulation, clearing systems and investor protection.
Rather than viewing blockchain as a replacement for traditional finance, Herrick described a model in which the two systems merge. “It’s not really a question of one side being more right than the other… [they] I think in time we should get together.
His comments come as exchanges, asset managers and banks test tokenization, which allows assets such as stocks and funds to be represented on blockchain systems. Proponents argue that this model could enable faster settlement, around-the-clock trading, and broader global access to markets.
The NYSE is exploring some of these uses, including real-time or near-real-time settlement and extended trading hours. The Intercontinental Exchange (ICE), the parent company of the NYSE, made a strategic investment in crypto exchange OKX earlier this month. ICE will license OKX’s crypto spot prices for crypto futures products, while OKX will offer ICE futures and tokenized stocks to its customers in the United States.
Herrick cautioned, however, that existing systems offer efficiencies that might not be easily replaced. Centralized clearing, for example, helps reduce risk by clearing transactions between market participants.
However, over time, the distinction between traditional assets and tokenized assets may become blurred. “Maybe in 10 years, let it be [a] Safety is symbolic or doesn’t matter,” he said.
For now, the exchange’s strategy suggests a slower, more gradual path forward, gradually introducing blockchain technology into the existing financial system rather than reshaping it overnight.
