It is not every day that the SEC approves a Form 1, which is the form used to apply to the SEC to operate as a national securities exchange. Just before the government shutdown, TXSE Group Inc. announced that the SEC approved the Texas Stock Exchange’s Form 1 registration to operate as a national securities exchange. The announcement notes:

TXSE is the first fully integrated national securities exchange to receive SEC approval in decades. TXSE has already completed its proprietary order matching engine and exchange platform, incorporating the latest hardware and software to deliver low-latency performance, flexibility, and scalability in an evolving trading and regulatory environment.

Importantly, TXSE will provide comprehensive listing solutions for corporate issuers and ETP sponsors that are aligned with their priorities and fully transparent. TXSE worked closely with the SEC staff throughout the approval and public comment process.

“Today’s approval marks a pivotal moment in our effort to build a world-class exchange rooted in alignment, transparency, and partnership with issuers and investors,” said James H Lee, founder and CEO of TXSE and its parent company, TXSE Group Inc. “Real competition for corporate listings in the United States has finally arrived.”

TXSE will launch trading as well as ETP and corporate listings in 2026. Over the long run, TXSE’s mission is to reverse the decades-long decline in the number of U.S. public companies by reducing the burden of going and staying public while maintaining some of the highest quantitative standards in the industry.

TXSE has already led the push for key legislative and legal reforms to strengthen Texas’ pro-business environment and establish the state as the premier jurisdiction for corporate headquarters, listings, and exchange operators. TXSE will continue working alongside Texas leadership to advocate on behalf of issuers and investors to reform policy at the state, federal, and regulatory levels.

Texas Governor Greg Abbott offered his congratulations to the TXSE on the SEC’s approval, stating:

“Texas is swiftly becoming America’s financial hub,” said Governor Abbott. “I congratulate the Texas Stock Exchange for the launch of Texas’ own trading platform that will spur economic development and expand the financial might of our great state around the world. Working together, we will make Texas stronger and more prosperous than ever before.”

This GreenbergTraurig alert notes:

The TXSE has developed a proprietary order-matching engine and exchange platform that employs hardware and software to deliver low-latency performance designed to meet industry standards. This infrastructure is designed to operate within today’s complex trading landscape and stringent regulatory environment. The platform supports listing solutions for both corporate issuers and ETP sponsors, and seeks to address evolving market demands for transparency, efficiency, and reliability.

The SEC acknowledged in its approval that many attributes of the TXSE’s listing rules, including listing standards and governance guidelines, are substantially similar to the pre-existing national security exchange frameworks. According to the SEC, the TXSE’s corporate governance standards are “designed to promote independent and objective review and oversight of the accounting and auditing practices of listed issuers and to enhance audit committee independence, authority, and responsibility.”

It will be interesting to observe the launch of a startup national securities exchange – we do not get an opportunity to see that happen too often!

– Dave Lynn