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How Ondo Finance is Revolutionizing Tokenized Equities
Intermediate
2025-09-05 | 10m
The convergence of traditional finance (TradFi) and decentralized finance (DeFi) has reached a pivotal moment with the emergence of
tokenized real-world assets
(RWAs). Among the most significant developments in this space is the tokenization of equities—representing traditional stocks and ETFs as digital tokens on blockchain networks. Leading this revolution is Ondo Finance
, a regulated platform that has recently launched Ondo Global Markets, bringing over 100 tokenized U.S. stocks and ETFs to Ethereum blockchain. This breakthrough offers global investors unprecedented 24/7 access to U.S. markets while maintaining the liquidity and security of traditional finance. The initiative represents more than just technological innovation. It's a fundamental reimagining of how financial markets can operate when freed from traditional constraints of time, geography, and intermediation.
Ondo Finance: Bridging Traditional Finance and DeFi
Ondo Finance is a
regulated platform specializing in tokenizing publicly traded stocks and ETFs. With over
$1 billion in assets under management, the firm has established itself as a pioneer in the rapidly growing tokenized securities market. Ondo's tokenized securities are issued under a
bankruptcy-remote legal structure and subject to daily third-party attestations, ensuring transparency and security for investors.
The platform operates at the intersection of traditional finance and blockchain technology, aiming to democratize access to investment opportunities that were previously limited to institutional investors or constrained by geographic boundaries. By leveraging blockchain's inherent capabilities—
24/7 availability,
peer-to-peer transferability, and
programmability—Ondo is creating a new paradigm for securities trading and ownership.
Nathan Allman, Founder and CEO of Ondo Finance, encapsulates this vision: "We saw stablecoins export the U.S. dollar by bringing it on-chain. Now, Ondo Global Markets is doing the same thing for U.S. securities". This statement underscores the company's ambition to make U.S. securities as globally accessible via blockchain as the U.S. dollar has become through stablecoins.
Tokenized Equities: Redefining Global Market Access
Tokenized equities represent
digital tokens on blockchain networks that correspond to traditional stocks or ETFs. Each token is
fully backed by the underlying security held with regulated custodians, reflecting both price movements and reinvested dividends to provide total-return exposure to the underlying asset. Unlike traditional securities, which are constrained by market hours and complex settlement processes, tokenized equities can be traded
24 hours a day,
5 days a week, with the flexibility to move between wallets, crypto exchanges, and decentralized finance protocols.
The value proposition of tokenized equities extends beyond extended trading hours. They address long-standing hurdles for international investors, who have traditionally faced
high fees,
limited access,
transfer frictions, and
geographic exclusions when trying to invest in the $64 trillion U.S. securities market. By representing traditional securities as blockchain-based tokens, these assets become compatible with DeFi protocols, enabling innovative use cases such as using tokenized stocks as collateral for loans, providing liquidity in automated market makers, or integrating into yield-bearing strategies.
Industry projections suggest substantial growth potential for tokenized equities, with tokenized financial assets potentially reaching
$2 trillion by 2030 and
$30 trillion by 20346. This growth is expected to be driven by increasing demand for global access to U.S. markets, particularly from emerging economies where traditional investment channels are often limited or restrictive.
Ondo's Approach to Tokenizing U.S. Stocks and ETFs
Ondo Global Markets employs a sophisticated methodology for tokenizing traditional securities that prioritizes
regulatory compliance and
investor protection. The platform provides access to tokenized versions of notable stocks such as Apple, Nvidia, and the QQQ ETF. These tokens are backed by securities held at
US-registered broker-dealersand cash in transit, ensuring that each token is fully collateralized by the corresponding traditional security.
The technical process begins when a non-U.S. investor purchases a tokenized stock through Ondo Global Markets. The platform then facilitates the purchase of the actual stock through U.S.-registered broker-dealers, which are held by regulated custodians. The investor immediately receives the corresponding token (e.g., AAPLon for Apple stock), which reflects the total economic return of the underlying security, including price appreciation and reinvested dividends (minus applicable withholding taxes).
Ondo's tokenized equities can be minted and redeemed during traditional market hours five days a week, aligning with conventional settlement cycles while still enabling 24/7 trading of the tokens themselves. This hybrid approach maintains connectivity with traditional market liquidity while offering blockchain's flexibility.
The platform has ambitious expansion plans, aiming to grow from the current 100+ tokenized assets to
over 1,000 assets by the end of 2025. This rapid scaling potential demonstrates how blockchain technology can dramatically accelerate access to financial markets compared to traditional infrastructure.
DeFi Integration: Unlocking Programmable Financial Applications
A revolutionary aspect of Ondo's tokenized equities is their
compatibility with DeFi protocols, creating unprecedented opportunities for financial innovation. Unlike many earlier tokenized stock products that were confined to closed platforms with limited functionality, Ondo's tokens are designed for
open transferability across wallets, exchanges, and protocols.
The tokens behave similarly to stablecoins in DeFi environments, enabling integration with
lending protocols,
decentralized exchanges,
yield farming strategies, and
automated portfolio management. This programmability allows investors to use traditional securities in ways previously impossible—such as using Apple stock as collateral to borrow stablecoins against it or providing liquidity in pools that include both crypto assets and traditional equities.
Chainlink serves as the
official oracle provider for Ondo Global Markets, supplying trusted price feeds that ensure accurate valuation of tokenized stocks onchain. This integration is critical for maintaining parity between the tokenized assets and their underlying securities, particularly for DeFi applications that require reliable price data for functions like determining collateral ratios or executing limit orders.
The compatibility with DeFi protocols represents a fundamental shift in how traditional assets can be utilized within financial ecosystems. By bridging the world of TradFi with DeFi, Ondo enables investors to maintain exposure to established companies while participating in the innovative financial landscape being built on blockchain technology.
Cross-Chain Interoperability Through LayerZero
Ondo Finance recognizes that true accessibility requires interoperability across multiple blockchain networks. While the initial launch of Ondo Global Markets occurred on
Ethereum, the platform has plans to expand to
BNB Chain and
Solana using
LayerZero-powered interoperability.
LayerZero is an
omnichain interoperability protocol that enables seamless cross-chain communication without relying on intermediate tokens or centralized custodians. This technology allows tokenized assets to move freely between different blockchain environments while maintaining their collateralization and regulatory compliance. The cross-chain capability significantly enhances accessibility by meeting users where they are already transacting, rather than forcing them to navigate unfamiliar blockchain ecosystems.
The expansion to multiple chains also addresses scalability challenges by distributing transaction volume across networks with different characteristics and fee structures. This multi-chain approach potentially lowers barriers to entry for investors sensitive to transaction costs, particularly during periods of high network congestion on Ethereum.
Looking further ahead, Ondo has announced plans to launch its own
Layer 1 blockchain, called Ondo Chain, designed specifically for institutional-grade financial markets onchain. This specialized blockchain could offer optimized performance for tokenized securities trading while maintaining interoperability with other networks through LayerZero.
Institutional Backing and Strategic Partnerships
The credibility and potential of Ondo's tokenized equity platform are reinforced by substantial
institutional backingand strategic partnerships. The company has collaborated with major players across both traditional finance and cryptocurrency sectors to build a robust ecosystem for its tokenized assets.
Ondo's infrastructure partners include
BitGo and
Ledger for secure custody solutions,
Chainlink for reliable price feeds, and major wallets like
OKX Wallet,
Bitget Wallet, and
Trust Wallet for user accessibility. These partnerships ensure that Ondo's tokenized equities integrate seamlessly with existing cryptocurrency infrastructure while maintaining institutional-grade security standards.
In July 2025, Ondo and
Pantera Capital announced they would allocate
$250 million to real-world asset projects, highlighting significant institutional commitment to advancing tokenization technology. This investment aims to strengthen connections between traditional financial markets and the digital assets sector.
Perhaps most notably, Ondo has integrated with
Block Street, a unified liquidity layer for tokenized stocks that doesn't depend on any single blockchain. Backed by firms like
Citadel,
Point72, and
Jane Street, Block Street provides institutional-grade liquidity tracks that enable users to borrow, short, and hedge tokenized assets at scale. The platform introduces two-way markets that allow users to borrow USDT using tokenized stocks as collateral and vice versa, significantly enhancing market depth and functionality.
Regulatory Compliance: Navigating Complex Frameworks
As a pioneer in tokenized traditional securities, Ondo Finance operates within a complex
regulatory landscape that varies significantly across jurisdictions. The platform has adopted a proactive approach to compliance, securing necessary licenses and working within established regulatory frameworks.
Ondo holds three critical financial licenses that form the foundation of its compliant tokenization model:
-
Transfer Agent (TA) License: Enables Ondo to serve as the official recordkeeper for security ownership, ensuring accurate mapping between on-chain digital tokens and off-chain legal rights.
-
Broker-Dealer (BD) License: Allows Ondo to execute underlying stock transactions when users mint or redeem tokens, providing the crucial link between investors and primary markets.
-
Alternative Trading System (ATS) License: Permits Ondo to operate a regulated secondary market platform where users can engage in peer-to-peer trading of tokenized stocks.
This comprehensive licensing approach distinguishes Ondo from many competitors and provides investors with greater regulatory protection. Nathan Allman, Ondo's CEO, emphasizes that "Ondo Global Markets is a breakthrough in financial access", but one that operates within existing securities laws rather than attempting to circumvent them.
Regulatory challenges remain significant, however. U.S. regulators have emphasized that
tokenized securities remain securities and must comply with existing securities laws and trading regulations. European regulators have also issued warnings about some tokenized stock products that may not confer actual shareholder rights, potentially leading to investor confusion and market integrity issues.
Ondo addresses these concerns by explicitly excluding U.S. and U.K. investors from its current offering, focusing instead on qualified investors in Asia-Pacific, Europe, Africa, and Latin America. This geographic targeting reflects the company's strategy of expanding access while respecting regulatory boundaries.
Exchange Adoption and Ecosystem Growth
The adoption of Ondo's tokenized equities by major cryptocurrency exchanges and fintech platforms has been rapid, signaling strong market interest and validation of the tokenization model. Notably,
Bitget and
Bitget Wallet have launched live trading of Ondo's tokenized real-world assets through official integrations.
These integrations allow users to
browse,
analyze, and
trade over 100 tokenized stocks and ETFs with a minimum investment of just $1, dramatically lowering barriers to entry compared to traditional brokerage accounts. Rather than relying solely on on-chain liquidity pools, Ondo's tokenized assets tap directly into the liquidity of traditional equity markets, offering execution comparable to traditional exchanges.
Other major platforms supporting Ondo tokenized stocks include
Gate,
Blockchain.com,
MEXC, and
LBank, while data providers like
CoinGecko,
CoinMarketCap, and
RWA.xyz offer tracking and analytics. This broad ecosystem support ensures that investors can access tokenized equities through their preferred platforms while maintaining visibility into market data and performance.
The growth of tokenized stock markets is reflected in the numbers: according to RWA.xyz, the total value of tokenized stock markets reached
$337.94 million with monthly transfer volume of
$185.13 million and
63,010 holders as of September 2025, representing a 3.3% increase from the previous month.
Conclusion: The Future of Tokenized Equities
Ondo Finance's launch of Ondo Global Markets represents a significant milestone in the convergence of traditional finance and blockchain technology. By tokenizing over 100 U.S. stocks and ETFs and making them accessible to non-U.S. investors 24/7, Ondo has demonstrated the potential to fundamentally reshape how global investors access American markets.
The platform's
emphasis on regulatory compliance,
institutional-grade infrastructure, and
DeFi compatibilitypositions it as a leader in the emerging tokenized securities space. Strategic partnerships with major custody providers, wallets, and liquidity networks create a robust ecosystem that supports both traditional investors venturing into blockchain and crypto natives seeking exposure to established companies.
Looking ahead, the potential growth of tokenized equities is substantial. Industry projections suggest that tokenized financial assets could reach
$30 trillion by 2034, representing a significant portion of global financial markets. This growth will likely be driven by increasing demand for global access to U.S. securities, particularly from emerging markets where traditional investment channels are limited.
However, challenges remain.
Regulatory uncertainty continues to shape the development of tokenized assets, with different jurisdictions taking varied approaches to oversight and compliance. Additionally,
technical risks such as smart contract vulnerabilities and oracle failures require ongoing attention and mitigation.
Despite these challenges, the trajectory is clear: tokenization is poised to transform traditional finance by making it more accessible, efficient, and integrated with the emerging digital economy. As Nathan Allman of Ondo Finance aptly stated, "We saw stablecoins export the U.S. dollar by bringing it on-chain. Now, Ondo Global Markets is doing the same thing for U.S. securities". This vision of globalized, democratized access to financial markets through blockchain technology represents not just an incremental improvement but a fundamental rearchitecture of how markets can and should operate in the digital age.
References:
Ondo Global Markets Launches +100 Tokenized Equities on Ethereum for Non-US Investors. (2025, September 4). CryptoRank.io. Retrieved from
https://cryptorank.io/news/feed/a8922-ondo-global-markets-launches-100-tokenized-equities-on-ethereum-for-non-us-investors
Equity Tokenization: Key Milestones from Pilots to Regulatory Contest. (2025, September 4). Cointelegraph. Retrieved from
https://cn.cointelegraph.com/news/equity-tokenization-key-milestones-from-pilots-to-regulatory-contest
Bitget and Bitget Wallet Support Trading of Over 100 Tokenized Assets via Ondo Finance. (2025, September 4). Bitcoinist.com. Retrieved from
https://bitcoinist.com/bitget-and-bitget-wallet-support-trading-of-over-100-tokenized-assets-via-ondo-finance/
Ondo Finance launches 100+ tokenized US stocks and ETFs on Ethereum. (2025, September 3). Cryptopolitan. Retrieved from
https://www.cryptopolitan.com/ondo-finance-brings-in-ondo-global-markets/
Ondo Finance Launches 24/7 Tokenized Trading for US Stocks and ETFs. (2025, September 3). CoinCentral. Retrieved from
https://coincentral.com/ondo-finance-launches-24-7-tokenized-trading-for-us-stocks-and-etfs/
CoinCatch Team
Disclaimer:
Digital asset prices carry high market risk and price volatility. You should carefully consider your investment experience, financial situation, investment objectives, and risk tolerance. CoinCatch is not responsible for any losses that may occur. This article should not be considered financial advice.
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