Kristen Scholer:

Welcome to another episode of the Inside the ICE House podcast. Today I am joined by Michael Blaugrund, he's a Vice President of Strategic Initiatives at Intercontinental Exchange or ICE for short. And Jon Herrick, Chief Product Officer at the New York Stock Exchange. Michael, Jon, thanks so much for joining me Inside the ICE House.

Michael Blaugrund:

Thanks for having us.

Kristen Scholer:

Yes.

Michael Blaugrund:

It's great to be here.

Jon Herrick:

It's great to be here.

Kristen Scholer:

Look, there is a lot to talk about and let's dive into this new 24/7 digital trading venue that the NYSE is developing. We saw the announcement hit the tape earlier this year in 2026. Michael, what opportunities does this unlock for investors?

Michael Blaugrund:

Well, I think that largely, we're responding to retail investors, many of whom came of age during crypto's early years. And they've come to expect an always-on, always-available kind of notional base, so like dollar-denominated trading experience versus the more traditional equities environment that trades during fixed market hours in terms of share quantity, settles over multiple days. Today's retail investor has a much more sort of fluid, flexible expectation, and so we're really excited to introduce our new trading venue that's going to allow for tokenized equities to trade instantly 24/7 against stablecoins. That's really going to unlock the same type of user experience that they may have come of age experiencing with crypto and other digital assets.

Kristen Scholer:

What is a tokenized security?

Michael Blaugrund:

Tokenized security is the representation of a security, it could be an equity or a bond, that is coded into a smart contract on a blockchain. But we've had electronic trading for many years and frankly, we have electronic bookkeeping today. So when people talk about it tokenized security, they're really talking about using a blockchain to mint, to burn, to transfer, to lend, to borrow, and otherwise conduct financial transactions for this bond or equity. We're going to facilitate the trading of tokenized equities, so that could be stocks listed today on NYSE or it could be new issues that are brought to market and issued natively on-chain. And we'll trade those against stablecoins, which are also tokens, but they represent dollars, not securities.

Kristen Scholer:

Okay. So for the average listener and/or viewer, because we are recording a video podcast here, is it complicated? It sounds complicated.

Michael Blaugrund:

Well, I think for the end retail investor, it's going to be very, very familiar. Right? People today are accustomed to 24-hour shopping, 24-hour dating apps. This is really an extension of your digital life. So the same way that you might move money, the same way that you might buy crypto, you'll be able to buy or sell tokenized equities.

For the broker dealers, that'll be the intermediaries that are representing those investors on our platform, they also will have a lot of familiar technology to interact with. We're building this with the NYSE Pillar matching engine, which is the underlying technology, the platforms that Jon operates in our equities and options business today currently employ. But then after a trade is consummated, everything will move to the blockchain. So that'll be kind of obfuscated from an investor, but we'll manage all the complexity of that atomic instant settlement on chain.

Kristen Scholer:

You guys are making it easy. That's, I think, the takeaway here. Jon, I want to bring you into this conversation as well. Why is now the time for the NYSE to develop this?

Jon Herrick:

It's an interesting inflection point in the growth of digital assets, the overall evolution of our industry, of the NYSE. It's really something that if you look at tomorrow's investor and the features that they're asking for that Michael was talking about, things like the ability to access markets in a follow the sun model regardless of day of the week, or the ability to trade in notional terms, these are features that are supported today in traditional finance, but they're supported in ways that could be improved by the introduction of some of these technologies.

So everybody's familiar with LLMs. LLMs are built on a token construct as well. You take a series of text, break it down into words or characters. In essence, you can think of tokenization in the real-world asset implementation with stocks in a similar way. When you wrap something in a smart contract, you're able, you improve the fidelity with which you're able to track it, fractionalize it, and you can do so much more with it.

So for us, it's really looking at the broader span of market participants. And I think I view this as a starting point. This is a foundation for broker dealers that serve retail investors to begin to build digitally-native product in a way that preserves all the things that are important about 100 plus years of markets that have evolved and the regulation that guides them. So this is really a starting point and we're putting this in place to help those firms meet the demands of their clients.

Kristen Scholer:

This is under development. I want to hear from you, Jon, about the technology that's going to power this and meet the standards that the NYSE demands.

Jon Herrick:

That's a great question. And I think when people think of the NYSE, they likely think of our iconic trading floor and the 230 plus years of history. And the truth is, when you've been around for that long, you go through several phases of reinvention. And you have to adapt to the world around you and constantly incorporate and bring in new approaches that help you achieve the same objective or stay true to that north star.

So when you think of what has gone on in this institution in the last decade, since we were bought by Intercontinental Exchange, it's a remarkable story of transformation. And when you take a step back from it, and I think these are things that both of us had the benefit of being a part of, it's this amazing transformation from analog to digital, right? From floor-based model to an electronic platform that really is unrivaled.

So the speeds with which we do things are mind-boggling and it's done at tremendous scale and with tremendous reliability. And I think all we need to do is look back at the market events of the last five years to say, "Wow, we've built a technology stack and the industry around us, our customers, even competitors, everyone has really delivered a phenomenal solution that keeps responding to new demands of volatility." And I think that is something that we want to preserve with this, right? We want to introduce this innovation in a way that doesn't create the need for that to be recreated in any way.

Kristen Scholer:

We're recording this in February, mid-February of 2026. It was less than a year ago that we saw intense volatility that the NYSE was able to manage well through during April of 2025, records broken on that day in particular. Is this digital 24/7 trading venue going to have that might to meet the demand?

Jon Herrick:

Yes, it's built on this same underlying technology that we use to run the seven exchanges that we operate across equities and options, as well as the two industry data processors. But as Michael mentioned earlier, the innovation that we're delivering is really building a hybrid version of that that incorporates a digital ledger, a privately permissioned blockchain to be able to facilitate the settlement of a transaction in an atomic way when that trade happens. And we think that's a fundamental building block to I think delivering this innovation and helping people build digitally-native products.

Michael Blaugrund:

One of the things, if I can add on that.

Jon Herrick:

Please.

Michael Blaugrund:

One of the things that Jon and the team at the NYSE are really focused on is trying to find the right harmony between using the innovative technology and capturing the promise of blockchain while ensuring that we maintain the investor protections that everyone has come to expect from NYSE. So deliberately, we're introducing this platform with a lot of the market structure conventions that everyone who kind of operates in our space would expect, things like the volatility controls of limit up, limit down, things like respecting trading halts if a company has some sort of material news.

And we're going to have to be creative and find ways that we can appropriately adapt for 24/7 operations because certainly, you've seen certain digital assets, certain cryptocurrencies have very wild swings, and that's something which wouldn't be appropriate for a more mature marketplace that's reflecting the fundamentals of a listed company. So there's definitely work to do to extend that heritage into the digital space. But I think what we've heard from a lot of our stakeholders is they're really pleased to see NYSE taking a leadership position here because we do need responsible innovation and I think we're very well positioned to provide that.

Kristen Scholer:

So Michael, you mentioned earlier that this new 24/7 digital trading venue is in some ways a response to demand that you've seen from retail traders, but it sounds like it is a bridge in ways between the retail trader and the institutional investor. What is the demand that you anticipate from both the retail and the institutional side?

Michael Blaugrund:

It's been very interesting to see how the eye of the beholder really frames what we're working on. I think for people who are crypto OGs, they look at this and they're like, "Oh, this is a very modest effort. You're having a private permission blockchain and data center that you control all the nodes. This is just kind of window dressing." By contrast, you talk to the more traditional financial institutions and they're like, "This is an outrageous rate of change. How could you possibly expect us to manage this type of innovation?"

So I think we're trying to be balanced and employ market structure conventions and the NYSE Pillar technology in a way that makes it a very easy on-ramp for the TradFi world. At the same time, beginning to build the fundamental building blocks that we can extend as regulation or legislation or just the competitive dynamics demand that we have the capabilities to support more composable, dynamic, extensible on-chain opportunities.

I think retail tends to be where innovation is born. Whether that's because of the sort of independence that a retail investor might have relative to a professional money manager or just the nature of competition and retail brokerage, you see a lot of brand new ideas start there, get to critical mass, and then institutions get interested and begin to participate. We're seeing that in prediction markets where that's a DeFi program that largely developed in this sort of retail primordial ooze. Began to evolve, had a lot of success, and now institutions are coming to Intercontinental Exchange asking for data from Polymarket, asking how they can get involved, how they can use that to inform their trading more broadly.

So I think what we're doing in digital assets, what we're doing with tokenized equities, I think it's similar. We are trying to support the retail investor, but that's going to cascade into the institution space.

Jon Herrick:

And I think we're trying to solve real problems, right? We're trying to deliver something that moves the ball forward. And the three things that Michael mentioned in the beginning, investors trade differently today. They think in dollar terms. This technology makes that a lot more scalable. It reduces friction.

The second thing is there's increased demand for immediate settlement, right? That feature alone is such an important building block of where we go with this. And something like that really does set you up to facilitate 24/7 operations. And a lot of this is empowering the firms that have done such a good job of serving retail investors in the US, it's giving them that ability to build digitally-native product and not see their customers move to other platforms because people trade differently today. They think about how they manage their investments differently. So I think in many ways it's about trying to solve a problem where that's the first step and then we just continue to innovate based on the participation and the interest and the ideas that come from the people that will work with us.

Kristen Scholer:

I want to talk more about that user experience here in a moment. For people who are listening and/or watching, they're probably wondering, "Well, how far away are we from this?" Where do we stand in the development of this venue? And how does regulatory approval factor in?

Jon Herrick:

I think we're in a pretty good position. So we've been working on a prototype of the core, sort of the hybrid private implementation of blockchain with Pillar, the matching engine technology for several months. So I think right now we're focused on, we've been working very closely with the SEC and the Crypto Task force and FINRA and other regulators on moving this forward in the right structure. So that's probably our most active thread and one that will definitely drive timelines.

The other is really, Michael was talking about this before, and I think it's really important. We think for traditional market participants that want to use this to begin to build more digitally-native product, we think the right first step is to keep their trading experience as consistent as possible with how they interact with Pillar today. So we're going to be using a lot of the same functionality, similar order types. We want to make that trade capture or trade trading experience as similar to the world they operate in today as possible and really avoid unnecessary regulatory exemptions until we have use cases that drive it because we recognize the real work's on the backend, it's the plumbing.

And I think when we look at it that way, we realize what gets delivered from our end in terms of the boring backend plumbing stuff is the work for us to do. We are informed and guided by the participants. These would be retail brokers, existing market makers that serve them, who help us sort of make the decisions around the margins of how they want to interact with one another, whether it's on-demand price improvement auctions or RFQ mechanisms or other trade capture order types.

But really, the most interesting thing to me, the thing I'm most fascinated to see is what do different firms that serviced end customers do with this technology? Because what we'll be doing is allowing for a retail broker or maybe a crypto-native firm that has begun to want to offer solutions like this to US-based customers, they're going to now have the ability to build product where Kristen, Jon, Michael could all have individual wallets, custody by that broker dealer on a platform like this.

So to me, that's going to be really interesting to see where's that innovation on the product side in terms of what's delivered to end retail customers. And I think that's one thing where when we look at this, this is not something that we can design everything in a vacuum here. We want to set that platform up and kind of see what drives the innovation. I think that's the most interesting part.

Kristen Scholer:

It sounds like, Jon, though, that you would anticipate probably a simplified user experience based on that product innovation that we would see from the underlying NYSE technology. Is that the case?

Jon Herrick:

Absolutely. And I think the simplified user experience though is very predicated on the end service provider that's building that product for the retail broker. But we really want to get this moving quickly. And I think being in a position to help foster some of that innovation, the back half of this year is a very realistic timeline for us. So I think we want to start moving quickly because we realize this is all about iteration.

Michael Blaugrund:

You mentioned we're speaking in mid-February 2026. I'm pleased to spend Valentine's Day nearly with my friend Jon. February, we're in the middle of a Congressional debate about whether we should change some of the underpinnings of how tokenized assets will be regulated. And I think what's really helpful with the way we've proposed our structure is that we don't require any meaningful regulatory exemptions. We don't require any legislative action. But if the rules shift, we'll be in a position to modulate quickly and further improve the experience for the end client.

Kristen Scholer:

I can sense the bromance with the digital trading 24/7 venue really underlying that. As you referenced, Valentine's Day is upon us as we sit down and record.

Jon Herrick:

Thanks for the reminder.

Kristen Scholer:

Yes.

Michael Blaugrund:

Yeah.

Kristen Scholer:

Yeah.

Michael Blaugrund:

You got one day, dude.

Kristen Scholer:

Yeah. 24 hours, that's right. All right, so I've heard the word on-chain obviously come up a bit, right? And obviously I'm sure for the retail trader, they're very familiar with these terms, tokenization, tokenized securities, digital assets, on-chain, everything that you all have been doing a great job of breaking down for our viewers and listeners in this podcast. I know when this announcement came out, it was noted that it could support multiple blockchains for settlement and custody. How do you determine which one or ones are a fit?

Michael Blaugrund:

We're going to interface with a number of other critical stakeholders. So first, we expect to interface with wallet infrastructure that's going to be kind of deeply integrated with our own ledger, that'll manage balances, inventory and serve as that sort of execution ledger as trades occur. So integrating with very robust, battle-tested, institutional-grade wallet infrastructure will be one consideration. And ensuring that we have access to a very broad developer community is one consideration.

We'll interface with digital transfer agents. That'll be firms like Securitize, Superstate, tZERO, or it could be traditional transfer agents that begin to evolve their business, firms like an Equiniti that may decide that they want to enter the space. Those firms are going to make technology choices. So ensuring we have interoperability with that community will be important.

The DTC, which is where virtually all existing assets are currently housed in the United States, is also making technology choices. So ensuring we have deep interoperability there will be important, as we move inventory from their systems onto our platform and back for more traditionally issued securities. So those are important.

And then finally, the stablecoin providers often have their own networks. We'll have to determine what's the most efficient way for us to interface with them. So we haven't yet publicly announced some of those technology choices, but we're certainly thinking about robustness, performance considerations, developer community, and kind of the roadmap that we see for our own projects, not just within NYSE, but more broadly across ICE, where we would expect that we're going to have projects in our clearinghouses, in our data business, in our mortgage business, and really look for having multiple solutions that we can employ across multiple use cases.

Kristen Scholer:

Jon, you mentioned that you anticipate a potential rollout of this 24/7 digital trading venue in the back half of 2026. Chronologically, what are the next steps to get there?

Jon Herrick:

So when I think of the work we're doing now, I think of it in a couple of fronts. And probably the most interesting blank canvas part of it is what drives some of the interesting things that we'll be doing with the digital transfer agents that Michael mentioned. And I think that's driven by our issuer community. And it's not something we've talked a lot about yet on the episode today.

That issuer aside to us it's like you think of two things that are our north stars, it's investor and issuer protections. And I think our issuer community on both of these fronts, the tokenization of existing equity, which is the no action letter pilot that DTCC will be rolling out later this year, but there's a whole host of corporate issuers that maybe have a digitally-native inherent business model or a crypto-native, and then a number of exchange-traded product and ETF sponsors that have remarkable ideas of things they want to do to get their product closer to end users.

And to me that's super, super interesting because it drives real innovation in new areas that I think, as I said before, we alone can't fill that vacuum here. We need willing participants, whether it's the issuer, whether it's the forward-looking partners that they work with.

But I do think for us that part is really big. It's a little bit easier to wrap your arms around what tokenization of existing US equities will look like. And just to give people a little glimpse into that, DTCC, in the latter part of last year, received approval to launch a pilot where they'll tokenize the Russell 1000. They'll effectively create the ability for the Russell 1000 to be tokenized to anyone that holds those shares within DTCC and a select group of ETFs. So what that means is if somebody has shares, if a broker dealer has shares in DTCC, they'll be able to use utilities that they've built to mint tokens and move those into a platform like ours to be traded in some of the ways we were talking about before. And I think how that bridge is built effectively is really important because I think that paves the way to what future innovations come. I think those are two really big areas of constant dialogue.

And then probably the biggest part of this is really getting the regulators comfortable with what structures exist today and where does this fit into those structures? And where do we need to not necessarily ask for a lot of exceptions, but there's going to be things that are different, right? Stablecoins are a great example, that's different than handling fiat currency. So I think there's definitely some things to work through, but we've been thrilled with the engagement and the cooperation of the regulators so far.

Kristen Scholer:

I'm glad that you highlighted there what's most important for the NYSE in this, issuers and investors. From the Intercontinental Exchange side of things, Michael, or ICE for short, of course, as our listeners well know, how does this fit into the broader ICE vision?

Michael Blaugrund:

Look, to play off something Jon said before, ICE is 25 years old. 25 years ago, they were really the catalyst for moving a lot of traditional derivatives markets from floor-based trading on screen. So that sort of electronification of markets has just been part of ICE's DNA from day one.

I think today you see history repeating itself, right? We moved from manual to electronic, we're now moving from electronic to digital. So looking at next-gen infrastructure across the entire enterprise, I think it's a very crucial part of all of our business units right now. In the clearinghouses, we're looking at the ability to also facilitate 24/7 operations, starting with tokenized deposits, but with an expectation that we would expand that over time to include tokenized money market funds, tokenized treasuries, stablecoins, and possibly crypto assets themselves.

We're looking, with our partnership with Polymarket, to support 24/7 prediction market activities. We're looking at the ability to expand crypto derivatives on our markets. We recently announced an expansion of our product line in support of a number of CoinDesk indices, which look at baskets of different cryptocurrencies across different exchanges. And I think we'll sort of help institutionalize participation in some of those underlying markets.

And then if you think about our mortgage business, if you think about other components of our broader firm, we have rich, rich data, we have very unique data, we have critical data. And bringing transparency and broad access and the analytics and the intelligence around that to produce actionable insight is something that's I think further empowered with the transition to blockchain technology. So I think it's this very interesting inflection point, again, to use your term of regulatory change, technology maturation, competitive dynamics shifting, where we're pouring a lot of energy into ensuring that we're going to remain central in the next phase of the marketplace.

Jon Herrick:

And I don't know if we weren't a part of ICE, right? If you envision the same company with the same technology stack, when you're building a venue that will atomically in the same transaction where a trade is executed, settle it, there's a comfort with what it means to operate clearinghouses to custody assets that is inherent in the DNA of ICE. So I think there's a part of this that is this unique, the ability for us to lean on our colleagues, to think outside the box I think is really unmatched when you look across the landscape of firms out there. So I think there's an element of that that I think is a real competitive advantage as we embark on this.

Kristen Scholer:

Interesting. Let's talk about Bitcoin. It's Friday the 13th, the day before Valentine's Day as we film this, and Bitcoin actually is up a few percentage points this morning to $67,000 a token, but we've seen it shed about half of its value. You mentioned the volatility earlier, Michael, from its recent high in October of 2025. The volatility that we still see in this digital asset space, such as with Bitcoin, I would say, does that tell us anything about where the future of this could go?

Jon Herrick:

I'll start and I'll share something that I always like to talk about when the concept of decentralized finance and traditional finance and maybe where they bump up against one another. I look at what has gone on the last two years with the adoption of Bitcoin ETFs in particular, and the suite of product offerings that have been built around it, as such a tremendous success story for how the two, the digital asset community and traditional finance have so much to do together. So I think that's been a very, very good thing for the further adoption, for the growth of Bitcoin. If you just look at how much of Bitcoins that have been in active circulation since ETFs have launched, that are held by these ETF issuers, it's remarkable.

And to me, that demonstrates I think some of the benefits of the issuer protection aspects of our markets, right? Not all rules are perfect, not all regulation is exactly what it should be. There's always room for improvement. But we do such a good job in the US. The reason why our markets are unrivaled is the execution quality. Right? The certainty, the determinism, the liquidity has really been, I think, tremendous for Bitcoin. And I think assets will go through various cycles and be tested. And I think our view is always to be in a position to be there to provide that risk transfer service. But I look at that with regards to Bitcoin, and really, I think it's a good example where we should look at the ways that the two worlds come together.

Michael Blaugrund:

I think if your question is does the price of Bitcoin impact our work, the answer is no. Right? And I think broadly, what you're seeing now across the industry is people are leaning in to tokenized assets, securities, stablecoin, crypto, even though the price levels are moving rapidly. So I think the sustained investment and the attention that people are paying into this space right now is divorced from the depressed levels of the crypto assets.

We're market operators. We don't prognosticate if things will go up or down. But I think to Jon's point, building infrastructure that's trusted, well-regulated, reliable, and resilient, allows for the markets to find those levels with confidence. And that's really our mission.

Kristen Scholer:

I'm curious to hear how you envision the evolution of a listing venue in a world where securities can be created, issued, and traded entirely on chain?

Michael Blaugrund:

It's coming. It's coming. I think that we're starting with trading and settlement, right? We're starting with this sort of simple use case of pre-funded from inventory sales of tokenized equities in exchange for pre-funded from inventory stablecoin on hand. But it's going to evolve. It's going to support borrow lend capabilities. It's going to support leverage. This will develop either from venues or from market participants who extend that credit.

Now, capital formation, a digital IPO, I think it's a matter of time until we have those types of innovations as well, both for corporates and for the create redeem functions and primary market functions and ETFs. So that's an area of focus where I think we'll have to come back and share more of the plans around that in the future. But I think that's 100% happening.

And it's happening today outside of the regulated space, right? It's about a year on that we saw a number of new digital assets emerge around the time of the inauguration. And those assets were able to raise tremendous amounts of money very, very quickly, fully on chain in a very efficient, if not chaotic way. So I think we've already seen a proof of concept in nature. What we need to do now is domesticate that and find a way to do it in a responsible fashion that'll allow for American retail and institutional investor to participate with confidence.

Kristen Scholer:

To end, Michael, Jon, what else do our viewers and listeners need to know about this 24/7 digital trading venue that we anticipate in 2026?

Jon Herrick:

I'll leave you with a thought that I think what we're trying to do, we talked about tokenization in the beginning, what it means. You could talk to 10 different firms that focus on 10 different parts of the market, and you might get 10 different interpretations of what it means. And I think in that regards, it's become a catchphrase for a lot of aspects of what we're trying to accomplish.

But I think if done correctly in time, it doesn't carry the same meaning, right? A security is still a security. A marketplace is still a marketplace, a listing standard is still a listing standard. And those sort of north stars that we talked about remain true. And I think that's the responsible part of what our job is, is to think about every step of the way, progressing innovation, but also not throwing away the best parts of what we have developed over the last 100 plus years.

So I think just thinking about it that way, maybe it's the world of traditional and decentralized finance just becoming financial services once again. But I think that's something that I think in time, if done correctly, will definitely become a reality.

Michael Blaugrund:

I think I would just end on digital markets are the next evolutionary step that NYSE and Intercontinental Exchange are facilitating. This building has seen a lot of technology innovation since its inception in 1903, and the prior buildings back from 1792, whether it was crowd trading, whether it was the development of continuous trading around the time of the Civil War, whether it was the telegraph, whether it was the ticker tape, whether it was [inaudible 00:38:31].

Jon Herrick:

Wireless technology.

Michael Blaugrund:

All these things have led us to broader participation, more efficient markets, better outcomes for investors, more efficient capital raising for companies. So change is hard. It's always hard, it's always a little scary. But I think for those of us who are privileged enough to kind of work on these challenging problems, there's a lot of satisfaction in seeing that we're part of a continuing mission to serve investors and issuers, and I think the future's very, very bright.

Kristen Scholer:

Michael, Jon, thank you so much for joining me Inside the ICE House.

Jon Herrick:

Thank you, Kristen.

Michael Blaugrund:

Thank you, Kristen.

Speaker 4:

That's our conversation for this week. Remember to rate, review, and subscribe wherever you listen and follow us on X @ICEHousePodcast. From the New York Stock Exchange, we'll talk to you again next week Inside the ICE House.

Information contained in this podcast was obtained in part from publicly available sources and not independently verified. Neither ICE nor its affiliates make any representations or warranties, expressed or implied, as to the accuracy or completeness of the information, and do not sponsor, approve, or endorse any of the content herein, all of which is presented solely for informational and educational purposes. Nothing herein constitutes an offer to sell, a solicitation of an offer to buy any security, or a recommendation of any security or trading practice. Some portions of the preceding conversation may have been edited for the purpose of length or clarity.