TXSE says SEC approves application for new Dallas-based stock exchange

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By Suzanne McGee

(Reuters) -The TXSE said on Tuesday that the SEC has approved its application to launch a new stock exchange, clearing the way for the Dallas-based Texas Stock Exchange to begin trading stocks and exchange-traded products by early 2026.

The venture, backed by investment industry heavyweights including BlackRock, Citadel Securities and Charles Schwab, aims to chip away at the dominance of the two existing national stock exchanges which, in addition to trading, offer listing services to companies seeking to tap into public markets in the U.S.

“It’s exciting to see a well-capitalized national securities exchange get approved by the SEC for the first time in decades,” said Hillary Holmes, a Houston-based partner at Gibson Dunn and co-chair of the law firm’s capital markets practice group.

She added, however, that it may take time for TXSE to build up a large roster of newly listed companies and meet its goal of becoming a competitive threat to the NYSE and Nasdaq.

Nasdaq declined to comment on the TXSE approval. The NYSE could not immediately be reached for comment.

TXSE said it aimed to reduce the burden of going public and remaining publicly traded. According to data from the SEC, the number of publicly traded companies on U.S. exchanges has fallen to about 4,400 from a peak of more than 8,000 in the 1990s.

To reverse this, the Texas Stock Exchange said it plans to attract listings from high-growth sectors including energy, technology and manufacturing. It also will seek to take advantage of perceptions that Texas is business-friendly, with lower taxes and lighter regulations.

A number of companies have moved their corporate headquarters to Texas in recent years, including Tesla.

“(Texas) has a long-term vision for driving economic growth, streamlining regulations, and building financial infrastructure,” James Lee, the new exchange’s founder and CEO, said in a press release.

Laura Morrison, a strategic adviser to TXSE and a member of its listing standards and governance advisory council, said the exchange aimed to obtain new, primary exchange listings business, either from companies going public for the first time or as a result of a company moving to TXSE from either the NYSE or Nasdaq.

Gibson Dunn’s Holmes warned, however, that there are many factors outside an exchange’s control that shape companies’ decisions to undertake an IPO or to stay public.

Those decisions, she said, “are the result of congressional action or SEC rule-making, with the second fluctuating depending on who is in the White House.”

She said the exchange would have room to maneuver on issues such as board and board committee makeup, which are the kind of topics that IPO candidates sometimes struggle to address in the final stages of preparing to go public.

The TXSE first announced its plans in June 2024, including details of financial backing from BlackRock and Citadel. It submitted its formal request for SEC approval in January.

Since then, it has recruited talent from other exchanges, including two veteran ETF executives from rivals Cboe Global Markets and Nasdaq.

But those rivals are not sitting idly by. On March 31, the NYSE opened its own Texas outpost, disclosing that Trump Media & Technology would be the first company to list there. Nasdaq also plans to vie for Texas business by opening a new regional headquarters in the state.

(Reporting by Suzanne McGee; Editing by Edmund Klamann)