- Ondo Finance has asked the SEC to allow it to record tokenized securities on Ethereum without broker-dealer registration.
- The request could help advance regulatory clarity as tokenized asset adoption continues to grow.
Ondo Finance has asked the U.S. Securities and Exchange Commission (SEC) to confirm that it can use Ethereum to record securities entitlements without registering as a broker-dealer. The request marks another step toward bringing traditional financial assets on-chain while seeking greater regulatory clarity in the United States.
Ondo Wants to Record Securities on Ethereum
Ondo Finance submitted a no-action letter to the SEC for its Ondo Global Markets platform, which offers tokenized notes tied to U.S.-listed stocks and exchange-traded funds (ETFs) for non-U.S. investors.
Under the proposed structure, the actual stocks and ETFs would remain in custody through the Depository Trust Company (DTC) using U.S. broker-dealer Alpaca. Instead of moving those assets on-chain, Ondo would issue Ethereum-based tokens representing the related securities entitlements.
The tokens would mirror the off-chain holdings while helping manage collateral and maintain synchronized ownership records on the blockchain.
Ondo asked the SEC to confirm that this record-keeping model would not require the company to register as a broker-dealer. If approved, the structure could provide a compliant path for integrating blockchain technology with traditional financial markets.
Tokenized Securities Gain Regulatory Attention
The request comes as U.S. regulators continue to show greater interest in tokenized financial products.
SEC Commissioner Hester Peirce has encouraged companies exploring tokenization to engage directly with the agency. At a recent House Financial Services Committee hearing, Representative Andy Barr also said tokenized securities are likely to become a larger part of financial markets while stressing the need to maintain investor protections.
The SEC has already approved a rule change allowing Nasdaq to support tokenized share trading. At the same time, companies including the New York Stock Exchange, Robinhood, Kraken, and Coinbase are developing their own blockchain-based equity products.
Although the SEC is working on broader regulations, it continues to provide interim guidance as the market evolves.
Tokenized Asset Market Continues to Expand
The tokenized real-world asset (RWA) market has grown rapidly as financial firms explore blockchain-based ownership records.
The sector is currently valued at about $23 billion, with Ondo accounting for roughly $2.8 billion. Industry forecasts suggest the market could grow to between $2 trillion and more than $10 trillion by 2030 if adoption continues.
The SEC has not publicly responded to Ondo’s request. Even if granted, a no-action letter would not create a formal rule and could later be revised or withdrawn. Still, the filing highlights the industry’s push for clearer regulations as tokenized securities move closer to mainstream adoption.
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