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20 October 2025

Texas Stock Exchange (TXSE) Approved As Newest National Securities Exchange

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On September 30, 2025, the U.S. Securities and Exchange Commission (SEC) approved the application of the Texas Stock Exchange LLC (TXSE)...
United States Texas Corporate/Commercial Law

On September 30, 2025, the U.S. Securities and Exchange Commission (SEC) approved the application of the Texas Stock Exchange LLC (TXSE) to become the 29th registered national securities exchange in the United States.1 This approval is a culmination of several other efforts supported by TXSE to champion the state of Texas as the most-business-friendly state in the country.2 The SEC's approval of the TXSE's application noted that parts of its registration, listing, and governance processes are substantially similar to existing exchanges, like NYSE, Nasdaq, and Investors Exchange LLC (IEX), another stock exchange founded in 2012.3

Registration Requirements

A company may apply to list on TXSE if the security is registered with the SEC pursuant to Section 12(b) of the Securities Exchange Act of 1934 or subject to a registration exemption.4 The TXSE must conduct a confidential pre-application eligibility review, available at no cost, to determine if the company is eligible for listing.5 If deemed eligible, TXSE will issue a clearance letter6 and direct the company to submit an original listing application.7 Once approved by TXSE and certified by the SEC, the company will be eligible for listing.8 TXSE will also allow companies listed on other national securities exchanges to dual-list on the TXSE.9

Listing & Corporate Governance Standards

Several of the TSXE's listing standards are substantially similar to those required by NYSE, including, but not limited to: (i) minimum numerical standards for common stock, (ii) policy on restated financial statements, and (iii) policy on reliance on the operating history of acquired companies.10 While there are no minimum numerical standards for preferred stock, the TXSE will consider delisting preferred stock if its market value falls below $2 million or fewer than 100,000 shares are publicly held.11 TXSE also requires each listing to have four registered and active Market Makers (except in the case of convertible bonds12) — one higher than the number required by Nasdaq13 — unless the listing company meets certain income, equity, and market value requirements.14

TXSE's corporate governance requirements overlap often with rules in existing exchanges. For example, the TXSE tracks Nasdaq and IEX with respect to audit committee composition,15 while language about maintenance of an internal audit function more closely parallels NYSE and IEX.16 The similarities extend also to exemptions from certain governance requirements, making it so that companies that wish to list on the TXSE will not need to change their pre-existing corporate governance structures.17

What's Next for TXSE?

While there is no exact date for TXSE's launch, it anticipates a launch sometime in 2026.18 It must first comply with final requirements imposed by the SEC in its approval letter, primarily involving registration with various national market system plans, followed by industry testing and perhaps a soft launch.19 Notably, October 15 marked the first day of trading on the 24X Exchange, whose Form 1 application was approved by the SEC in November 2024.20

The myriad similarities between TXSE and existing national exchanges likely hastened the SEC's approval of the exchange. Not only does a similar exchange make it easier for the SEC to approve, companies will be able to more easily meet the registration, listing, and governance requirements of TXSE. If all goes to plan, TXSE may attract some of the biggest market players onto their platform and into the state of Texas with low barrier of entry.

Footnotes

1 In the Matter of the Application of Texas Stock Exchange LLC for Registration as a National Securities Exchange; Findings, Opinion, and Order of the Commission, Release No. 34-104146, File No. 10-249 (Sept. 30, 2025) [SEC Approval Letter].

2 Texas Stock Exchange" Fact sheet on TXSE, TX. STOCK EXCH. (Sept. 30, 2025).

3 SEC Approval Letter, p. 39-40.

4 TXSE Rule 16.203(a).

5 TXSE Rule 16.201(a).

6 TXSE Rule 16.201(a).

7 TXSE Rules 16.201(a), 16.202(a).

8 SEC Approval Letter, p. 38-39.

9 TXSE Rule 16.205(a).

10 E.g., compare TXSE Rules 16.310 (initial listing) and 16.322 (continued listing), with NYSE Listed Company Manual § 102.01 (initial listing) and § 802.01 (continued listing).

11 TXSE Rule 16.314(a).

12 TXSE Rule 16.315(a)(2).

13See e.g., Nasdaq Rule 5505(a)(4).

14See e.g., TXSE Rule 16.310(d).

15Compare TXSE Rule 16.405(c)(2) with Nasdaq Rule 5602(c)(2) and IEX Rule 14.405(c)(2).

16 Compare TXSE Rule 16.414 with NYSE Listed Company Manual § 303A.07(c) and IEX Rule 14.414.

17 Compare TXSE Rule 16.407 with Nasdaq Rule 5615 and IEX Rule 14.407.

18 TXSE Group Inc announces SEC approval of Texas Stock Exchange, TX. STOCK EXCH. (Sept. 30, 2025).

19 SEC Approval Letter, p. 48.

20 24X National Exchange Opens for Trading as First SEC-Approved 23/5 Stock Exchange, PR NEWSWIRE (October 15, 2025).

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