Formation plans 24/7 stock trading on Solana under SEC rules

Formation Securities has notified the US Securities and Exchange Commission (SEC) of plans to launch a Solana-based trading platform for tokenized stocks in early 2027, with shares of Exodus Movement, Forward Industries and Galaxy Digital expected among its first offerings.

According to the company’s Nov. 9 announcement, the proposed platform will operate under the SEC’s Innovation Exemption, which permits certain tokenized securities to trade through approved arrangements without requiring the operator to register as a traditional securities exchange.

The venue would allow verified investors to buy and sell eligible US-listed shares around the clock using stablecoins and other permitted assets. Formation has not started trading, and its proposed launch remains subject to the conditions of the SEC’s exemption.

Formation plans 24-hour tokenized stock trading on Solana

Formation Securities plans to use Solana’s blockchain to support trading in tokenized versions of publicly listed company shares. The company says the securities will retain the same shareholder rights as traditional stocks, including voting rights and dividend payments.

Its initial offerings are expected to include Exodus Movement (EXOD), Forward Industries (FWDI) and Galaxy Digital (GLXY). Formation will work with tokenization providers Superstate and Securitize to make eligible securities available through the platform.

Investors will be able to hold tokenized shares in their digital wallets and trade them against stablecoins. Transactions are expected to settle directly on Solana, with buyers receiving securities and sellers receiving payment through the same blockchain transaction.

Unlike conventional stock exchanges, which follow established trading hours, the planned venue will support transactions throughout the day and night. However, participation will remain restricted to investors who complete identity verification and meet applicable eligibility requirements.

The company plans to distribute access through its platform and partners including Alpaca, Passage by CoinList, Anchorage Digital Bank, BitGo Bank & Trust, Fireblocks, Solflare and Squads.

“Tokenized stocks will succeed only if public companies see the value in them, and we intend to build this market together with issuers,” Formation Securities President Christopher Montagano said.

SEC exemption sets conditions for tokenized stock platforms

Formation’s proposal follows the SEC’s September 17 decision allowing certain tokenized securities venues to operate under temporary regulatory exemptions.

The framework permits eligible stocks to trade through permissioned automated market maker pools, which use smart contracts to facilitate transactions between participants.

Unlike traditional exchanges that match buyers and sellers through order books, these pools allow participants to trade against available liquidity under predefined rules.

The SEC requires participating venues to maintain limits on trading volumes and the number of securities offered. Operators must verify that tokenized shares carry equivalent rights to their traditional counterparts and provide public disclosures about trading activities.

Under the regulator’s notice requirements, operators must publish their proposed arrangements at least 30 days before opening. Submitting a notice does not establish that the SEC has approved a particular venue or confirmed its compliance.

Formation’s public filing identifies the three intended launch securities and describes how the platform will review tokenization structures before admitting shares to trading.

Formation joins expanding tokenized stock market

The company’s plans follow the launch of several blockchain-based stock products and trading arrangements involving existing securities firms.

On Nov. 4, Canton Strategic Holdings completed tokenized stock transactions on the Canton Network under the SEC’s September exemption, crypto.news previously reported.

Meanwhile, Securitize confirmed in October that 12 tokenized US stocks were available on Solana for eligible investors, including products referencing Apple, Nvidia and Tesla.

Its existing stock products use security entitlements backed by shares held through a broker-dealer. Investors must complete onboarding, while the underlying companies have not necessarily sponsored the tokenized offerings.

Formation says it intends to work directly with issuers. The SEC’s exemption requires venues to give companies an opportunity to object before admitting securities tokenized by an unaffiliated third party.

The distinction has become relevant as tokenized stock platforms develop arrangements for trading traditional securities on public blockchains.

Formation names custody and compliance partners

Formation Securities has licensed trading technology from Solana decentralized exchange Orca, whose automated market maker software has processed more than $550 billion in digital asset trades through October 31, according to the company.

The planned venue builds on Project Open, a proposal submitted to the SEC’s Crypto Task Force in April 2025 by a coalition including Orca, Superstate and the Solana Policy Institute.

For compliance and transaction monitoring, Formation has named Predicate, Sec3, Solidus Labs and TRM Labs as service providers.

Its public notice states that the platform will publish transaction information, including prices, trading volumes and timestamps, while maintaining the official shareholder records through applicable transfer agents.

The filing further provides for transaction data covering the preceding 30 days to be updated within 10 minutes of each trade. Formation will publish the smart contract addresses of its liquidity pools, daily share volumes and pool balances.