Former Gov. Andrew Cuomo has landed in the middle of a crypto fracas as he backs tokenized stock exchanges – a new crypto-based trading model that has incited blowback from major companies that don’t want their shares traded with crypto.
Tokenized shares ties a digital token to a traditional stock so the token’s price mimics the shares of a publicly listed company. Crypto junkies have argued it’s the future of finance, allowing investors to trade 24/7.
In June, Cuomo was named the co-chairman of OKXICE – a 50-50 joint venture between China-based crypto exchange OKX and the Intercontinental Exchange, which owns the New York Stock Exchange.
But the tokenized exchange Cuomo is touting is already facing blowback from a range of businesses.
Cerebras Systems, AppLovin, Applied Digital, Rocket Lab, CoreWeave, Verizon, Applied Optoelectronics, Broadcom and UnitedHealth all recently objected to being included on OKXICE, the new tokenized exchange.
After resigning as governor amid a slew of harassment allegations which he has denied, Cuomo left the governor’s mansion in 2021. He then worked as a consultant for several unidentified companies, earning nearly $5 million in 2024, according to his tax returns.
He worked as a paid advisor for OKX starting in 2023, according to the company. Last month, Cuomo bought a $9.6 million estate in the Hamptons.
“Everyone’s talking about ‘tokenize this, tokenize that, tokenizing securities,’” Cuomo – who suffered a brutal defeat to NYC Mayor Zohran Mamdani last year – told the Wall Street Journal earlier this month.
“If you could sell American equities 24/7 globally, wow, that is really a transformational game-changer. That can bring billions into the American economy,” he said.
In 2025, OKX agreed to pay more than half a billion dollars and pleaded guilty to violating anti-money laundering laws following an FBI investigation.
Representatives for the SEC, Intercontinental Exchange and Cuomo did not immediately respond to The Post’s requests for comment.
Tokenized stock exchanges don’t need permission to link themselves to traditional stocks. Instead, the affected companies are given a 30-day window to opt out of being included on the new exchanges.
But a growing number of traditional companies say they don’t want their shares traded 24/7 – arguing the new form of trading is simply a way of skirting regulations.
Traditional stock trading, for example, is subject to best-execution pricing, meaning trading prices need to reflect the real-time value of a stock. But there could be an issue with pricing disparities between the exchanges.
Traders “shouldn’t confuse the ability to trade stocks around the clock with an improvement in how stocks trade,” said Ken Mahoney, chief executive of Mahoney Asset Management. “A market isn’t necessarily a more efficient market if price discovery suffers and investors face wider spreads.”
It’s unclear whether tokenized exchanges will be subject to the same regulatory oversight as traditional exchanges, particularly when it comes to uncovering insider trading and other forms of market manipulation.
OKXICE has said it relies on internal surveillance and third parties, and that users will have to pass identity verification, anti-money laundering and sanctions checks.
The pushback is a sign of early challenges that OKXICE could face in its attempts to pursue broader adoption.
In September, the Securities and Exchange Commission issued an order to speed along the trading of tokenized shares in the US.
OKXICE quickly became one of the first ventures to file with American regulators to launch a 24/7 tokenized stock trading platform.
Proponents of the new form of trading have argued it’s a more efficient way to trade and track share ownership – and the ability to trade around the clock is considered the biggest advantage.
“Trading normally stops at night and on weekends because participants must complete post-trade operations, like calculating and clearing obligations, settling trades and unwinding them when counterparties fail to deliver assets or cash,” Barry Plunkett, a tokenization expert and CEO of Cosmos Labs, told The Post.
“Tokenization collapses all of these post-trade operations into the transaction itself,” he said. “The blockchain serves as a shared record of transaction status for all participants, and it moves the asset and the money together in seconds.”
But Mahoney warned investors could shun the new exchange, fearful of the added risks that come with a tokenized exchange holding, especially when there’s already plenty of volatility in traditional markets.
“There is also the concept of owning a stock outright through a brokerage platform and owning a perpetual contract tied to a stock’s price, which it seems is done on a tokenized exchange,” he said.
Plunkett added that the major risk is that tokenized stocks become “a claim on cash held somewhere unreliable. If tokenized cash can’t be redeemed without fees for cash in a bank account, or the stock isn’t clearly backed…problems will still follow.”
Despite already receiving rejections from nine major companies, OKXICE remains optimistic. Its proposal names more than 60 companies whose shares could eventually be tokenized, including Nvidia, Tesla, Apple, Microsoft, Coinbase and Robinhood.
Cuomo has said that in five years, he sees the tokenized exchange as the future of finance.
“It’s no longer just a crypto company,” he predicted. “It’s a financial-technology company, meaning there will be a platform where you conduct all your financial business, aided by AI, and you can trade stock, you can make payments, you can consult with AI on market trends, but it would be a platform to do all financial transactions. I think that is the long-term future.”