NYSE-ICE Deal Signals Stocks Are Not the Future: Pitt

Former SEC Chairman Harvey Pitt told CNBC on Thursday that a deal for NYSE Euronext to sell itself to smaller rival IntercontinentalExchange (ICE) signals that "equity trading is not the wave of the profitable future."

"Technology has changed the landscape," said the CEO of Kalorama Partners Pitt on "Squawk Box."

"Trading volume for equity securities has largely left the New York Stock Exchange, which has become more of a forum for smaller transactions," he added. "And 'dark pools' have been the forum for larger transactions."

Pitt said he thinks this deal has a "high percentage of passing" regulatory muster.

The deal was confirmed by the exchanges Thursday morning, but CNBC's David Faber first got wind of the talks last night.

Pitt said ICE does not appear to have any "real interest" in the equity business of the NYSE, and he speculated that it would be eventually spin-off in "subsequent transactions."

"The most logical buyer and the one that's been trying to acquire it is NASDAQ," he said. "The question is whether the anti-trust authorities are going to allow that kind of merger because it would create a behemoth of equity trading in the U.S."

Besides NASDAQ OMX Group, Pitt said he thinks there would be a lot of buyers lining up, particularly from overseas.

Follow Matthew J. Belvedere on Twitter @Matt_SquawkCNBC