The New York Stock Exchange (NYSE) is focused on integrating blockchain technology into existing market infrastructure rather than replacing it, according to Chief Product Officer Jon Herrick.
The exchange “strives for interoperability” and “builds on top of what exists” as it explores how tokenized assets can work within current systems, Herrick said.
This approach reflects a broader attitude towards market development. “You have to pay attention to the intrinsic good things in the market that have developed up until now … it’s this balance between both things,” he said on stage at the Digital Asset Summit in New York on Thursday, referring to the need to preserve elements such as regulation, clearing systems and investor protection.
Instead of framing blockchain as a replacement for traditional finance, Herrick described a model where both systems merge. “It’s really not about one side being more right than the other… [they] should, I think, in time come 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 the model could enable faster settlement, around-the-clock trading and wider global access to markets.
The NYSE is exploring some of these uses, including real-time or near-real-time settlement and extended trading hours. Intercontinental Exchange (ICE), the NYSE’s parent company, made a strategic investment in crypto exchange OKX earlier this month. ICE will license OKX’s spot crypto prices for crypto futures products, while OKX will offer ICE futures and tokenized stocks to its clients in the US
Still, Herrick cautioned that existing systems offer efficiencies that may not be easily replaced. Centralized clearing, for example, helps reduce risk by netting transactions across market participants.
Nevertheless, the distinction between traditional and tokenized assets may fade over time. “Maybe 10 years from now, if [a] security is tokenized or not should not matter,” he said.
For now, the exchange’s strategy suggests a slower, more incremental way forward, gradually introducing blockchain technology into the existing financial system rather than reshaping it overnight.
