Ondo Finance Enables In‑Kind Tokenized Stock Minting and Redemption on Ethereum and BNB Chain

Ondo Finance has introduced an in‑kind conversion route that lets approved institutions mint and redeem Ondo Stocks using the actual shares they hold. The process is powered by Alpaca’s Instant Tokenization Network (ITN) and is currently available on Ethereum and BNB Chain.

How the In‑Kind Conversion Works

Institutions with active accounts on both Ondo and Alpaca can transfer the underlying stock or ETF from their Alpaca brokerage account to Ondo’s Alpaca account via an internal book transfer. Ondo then issues the corresponding tokenized position on the supported blockchain. Redemption reverses the flow, burning the tokens and returning the shares to the institution’s Alpaca account.

Benefits for Market Makers

• Eliminates the need for separate cash funding when minting tokens, allowing participants to use shares they already own.
• Potentially reduces financing costs and timing mismatches for institutions that need additional tokenized inventory.
• Ondo expects tighter spreads and deeper secondary‑market liquidity, though no post‑launch liquidity data has been released.

Access and Eligibility

Access is granted on a case‑by‑case basis by Alpaca. Only institutions approved by Alpaca and holding active accounts with both platforms can use the service. The feature does not alter the terms for regular Ondo Stocks holders, who remain limited to eligible non‑U.S. persons.

Platform Scale and Asset Coverage

RWA.xyz tracks $3.63 billion in distributed assets across 441 Ondo products as of September 22, with roughly $2 billion on Ethereum, $407 million on BNB Chain, and $301 million on Solana. Ondo’s broader tokenized stock offering spans more than 450 stocks and ETFs across Ethereum, BNB Chain, and Solana.

Regulatory Context

Ondo’s tokenized stocks are not classified as the underlying securities and do not automatically confer ownership rights. The service operates under existing brokerage and DTC custody structures, and the company has pursued separate regulatory pathways, including a no‑action request to the SEC regarding the use of Ethereum as an operational layer for tokenized securities.