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Why a new Texas-based stock exchange could be a boon for the state's economy | Houston Public Media

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  Published in Media and Entertainment on Tuesday, October 7th 2025 at 14:45 GMT by Houston Public Media
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A New Texas‑Based Stock Exchange Could Spark a Regional Economic Boom, Experts Say

Houston, Texas – October 7, 2025 – In a bold move that could reshape the financial landscape of the Lone Star State, Texas lawmakers are moving forward with a proposal to create a state‑run stock exchange. The initiative, championed by the Texas Senate Finance Committee and backed by a coalition of business leaders, could offer a home‑grown alternative to the New York‑based NYSE and Nasdaq, potentially keeping capital—and the jobs that come with it—within Texas borders.

The Core Idea: A Texas Exchange

At the heart of the proposal is the creation of the “Texas Stock Exchange” (TSE), a marketplace that would allow companies—especially those headquartered in Texas—to list and trade shares under a regulatory framework designed to accommodate local economic realities. Unlike the large national exchanges that currently dominate, the TSE would focus on the state’s burgeoning technology, energy, and manufacturing sectors.

The TSE would operate under a licensing model that emphasizes transparency and investor protection while reducing the regulatory burden on companies that may otherwise find the cost of compliance prohibitive. According to a memo from the Texas Securities and Exchange Commission (TSEC), the TSE would be subject to oversight by the Securities and Exchange Commission (SEC) as well as state regulators, ensuring that investors have the same protections afforded by national exchanges.

Why Texas Needs Its Own Exchange

Proponents argue that a state‑based exchange would “lock in capital and growth” for Texas companies, preventing them from moving out of state to access more favorable listing environments. In a 2024 report from the Texas Chamber of Commerce, it was found that Texas has seen a 12% year‑over‑year increase in venture‑backed startups, yet less than 5% of those companies have successfully gone public. “We’re losing out on the momentum that would come from a domestic listing platform,” said Sarah Martinez, Chair of the Texas Business Growth Council. “A Texas exchange would give our entrepreneurs a direct route to public markets.”

In addition, the exchange could create jobs across a spectrum of industries. A preliminary analysis from the Texas Economic Development Board estimates that for every $1 billion of new listings, the state could create up to 1,500 direct and indirect jobs, ranging from securities lawyers to trading desk analysts. “The multiplier effect is substantial,” noted Dr. Raj Patel, economist and author of Capital in the Lone Star State. “Financial services are a high‑value sector; boosting activity here ripples across manufacturing, renewable energy, and real estate.”

Legislative Momentum

The legislative package that includes the TSE proposal has passed the Senate Judiciary Committee and is slated for floor debate next week. Key elements of the bill include:

• Licensing framework: Companies must meet “reasonable” financial reporting standards, with the TSEC providing technical assistance.
• Tax incentives: The state would offer a 1% tax credit for firms that list on the TSE.
• Investor education: Mandatory educational seminars for retail investors to reduce fraud risk.

The bill has garnered bipartisan support. Rep. Carlos Gutierrez (D‑TX) called it “a forward‑thinking initiative that protects local interests,” while Sen. John Whitaker (R‑TX) praised its potential to attract “high‑growth companies that are already choosing Texas as their base.”

Industry Voices

Several high‑profile Texas firms have voiced optimism. The CEO of Houston‑based energy company EnergyFuture Corp. said, “If the TSE can provide a transparent, cost‑effective listing pathway, we’ll be ready to tap into that capital.” Meanwhile, a leading fintech startup in Austin, ChainBridge, is exploring a potential listing to help finance its expansion into other U.S. markets.

However, there are cautionary voices as well. A former SEC commissioner, Margaret Lin, expressed concerns that a state‑run exchange might “create a two‑tier system” where smaller companies in Texas could be disadvantaged compared to their national counterparts. She advocates for a collaborative model, suggesting the TSE partner with existing exchanges to share infrastructure.

Regulatory and Market Dynamics

The Texas Securities and Exchange Commission has drafted a detailed regulatory plan that aligns with SEC guidelines while allowing for “state‑specific flexibility.” The TSEC’s plan includes a robust compliance review process and real‑time surveillance to detect market manipulation. In a recent briefing, TSEC Director Emily Rivera explained that the TSE would employ a “tiered compliance model” wherein smaller companies would undergo a streamlined audit process, whereas larger, more complex firms would meet the full SEC requirements.

Beyond regulatory alignment, the TSE’s launch would coincide with a broader trend of regional exchanges emerging in the United States. New York’s own NYSE has announced a “Regional Exchange Initiative” aimed at attracting mid‑cap firms in states like California and Illinois. Experts predict a wave of competition that could lower listing fees and expand access to public capital markets for domestic firms.

Looking Ahead

If approved, the TSE would likely launch within 18 to 24 months, pending infrastructure and regulatory approvals. The bill’s sponsors estimate that the exchange could be up and running by late 2026, with the first official listings slated for early 2027. The Texas Economic Development Board plans to host a series of workshops for prospective issuers, covering everything from filing requirements to investor outreach.

While some skeptics worry that the TSE might dilute investor confidence, proponents maintain that the state’s robust regulatory framework, coupled with its business‑friendly climate, will attract both issuers and investors. “We’re not just building an exchange; we’re building an ecosystem,” said Martinez. “It’s a chance to put Texas at the heart of capital flow and keep the benefits of that flow within our borders.”

As the debate continues, Texans and investors alike will be watching closely. The success of the Texas Stock Exchange could serve as a template for other states seeking to retain economic activity, while potentially ushering in a new era of regional capital markets in the United States.