A decades-old dream in Dallas may soon become a reality: Texas is looking to open the country's first national stock exchange.
Texas native James Lee has raised about $120 million from dozens of individual investors and big names like BlackRock Inc. and Citadel Securities Inc. to become CEO of the Texas Stock Exchange, which is currently scheduled to hold its first trade in the second half of 2025 and its first listing in early 2026.
The Texas Stock Exchange will be the new listing venue for public companies, exchange-traded products and American Depositary Receipts primarily from the southeastern U.S. Once fully operational, it will employ 100 people in the Dallas area.
Though Lee is based in Houston, Dallas is a natural candidate for a national stock exchange: The region is in the midst of a population boom attracting ultra-wealthy and middle-class residents, and Dallas is looking to add more companies to its list of headquarters destinations.
Just as D-FW International Airport brought unexpected levels of prosperity to the region, Lee believes a fully electronic Texas Stock Exchange will have a similar effect, drawing more headquarters and capital to the area.
The Texas Stock Exchange will focus on attracting companies from Texas, Oklahoma and the southeastern United States, including Alabama, Arkansas, Florida, Georgia, Louisiana, Mississippi, Tennessee, North Carolina and South Carolina.
“We are seeking to become the third-largest listing location in the United States,” Lee said. “This is exciting, this is transformative, and frankly, this could change the future of Dallas for decades to come. It's this density of technology infrastructure, market participants and network effectiveness that makes Dallas a major financial hub.”
Chief among Lee's list of people he wants to thank for this landmark moment is Governor Greg Abbott, who recently rang the closing bell at the New York Stock Exchange. Without the governor's ambition to bring a stock exchange to Texas, Lee said, this would have remained a dream.
“It's undoubtedly because of Governor Abbott's leadership that we're here today,” he said. “We're just the team that was able to put this together. We had the right organizational support and, frankly, the right plan and the people to make this happen. But this started with Governor Abbott's leadership and it was there long before us.”
In 2020, as New York state officials debated whether to tax stock trading through a financial transaction tax, the New York Stock Exchange considered relocating to Texas. That move ultimately did not come to fruition, as did the NYSE's move to Texas.
Still, the New York Stock Exchange and its president, Lynn Martin, continue to focus on Texas as an economic powerhouse: its $2.4 trillion economy is the eighth largest in the world, ahead of Canada, Italy and others.
It also helps that Abbott is an ally of wealthy institutional investors, and he has advocated amending the state constitution to ban a financial transaction tax in the future.
While it does not have a physical trading floor, it maintains its headquarters and executive offices in Dallas and operates from a data center in the city, which has about 150 data centers in the region, generating 650 megawatts of power. Real Estate Advisor magazine.
The Texas Stock Exchange will continue to have a presence in downtown Dallas, with a location that will serve as a physical front for the electronic exchange.
The exact location has yet to be announced, but it will be a place where investors and traders can visit to view the latest listing activity, Li said.
“This will be the place for forecasting, quoting, visibility and trade reporting,” he said. “There will be lots of co-branding opportunities for our publicly traded companies and we will be hosting regional and global conferences here in the heart of the Texas ecosystem.”
Lee said he and the Texas Stock Exchange are already in contact with several large Dallas companies, as well as companies across the country, to list on the exchange once the system goes into effect.
“It's not just statewide. We have 1,522 public companies in the southeastern U.S., so that's really the primary market for our business,” he said. “Our approach creates more alignment between public companies and the corporate or sponsored listed products.”
Another aim of Lee and the Texas Stock Exchange in pushing for the companies to go public is to promise business-friendly stability in Texas following New York state's proposed financial transaction tax, he said.
“We are simply responding to market demand. We are big believers in American capitalism and the power of competition in the capital markets,” he said. “That doesn't mean we're trying to push the envelope. But we believe there are ways to get more private companies looking to go public by adjusting our criteria for the early stages of growth.”
Lee acknowledges that it's a bold move for Texas to open a stock exchange that could dramatically change how and where people invest for years to come, but to him, he said, it's just business.
“If we were to take action, [NYSE and NASDAQ]”That's just part of the competitive process,” he said. “This is a national securities exchange, and if we're fortunate enough to get SEC approval, then I think we'll be able to focus our initial efforts.” [the Southeast] The adjustments we are making will enable us to capture some share in these markets.”
Lee and the Texas Stock Exchange still have a long way to go before it's officially recognized: He's been working on the effort for years, but it must apply for registration with the Securities and Exchange Commission later this year in order to legally operate as a national securities exchange.
He said he believes his group will help make Texas' economy more prosperous by increasing investment and relocation to Dallas and Texas.
“Not a day goes by that we don't get an invitation to get into cryptocurrencies, derivatives or other trading instruments,” he said. “Our objective here is to leverage the unique characteristics and environment we have, focus on building critical mass and gain significant operating leverage as we grow.”
“It's an exciting time to be in Texas, especially Dallas.”
