ONDO jumped roughly 16% Wednesday after reports that the U.S. Securities and Exchange Commission is preparing a framework that could let tokenized versions of stocks trade on crypto rails. The token traded near $0.390, up 15.5% over 24 hours, with about $228 million in daily volume and a market capitalization near $1.9 billion.
The SEC's innovation exemption
According to a Bloomberg report, the SEC could release an 'innovation exemption' for tokenized stocks as soon as this week. The framework would create a path for digital versions of securities to trade outside traditional exchange venues and on decentralized crypto platforms — including tokens that may not have the consent or backing of the public companies whose shares they track. That's a big shift for a regulator that has historically kept crypto securities at arm's length.
Ondo's dominance in tokenized equities
The news comes as Ondo Global Markets — the tokenization arm of Ondo Finance — recently crossed $1 billion in total value locked, less than eight months after its September 2025 launch. The platform now holds more than 70% of the tokenized equity issuer market and has processed more than $18 billion in cumulative trading volume. It currently offers more than 260 tokenized U.S. stocks and ETFs across Solana, Ethereum and BNB Chain. Katie Wheeler, Managing Director of Global Partnerships at Ondo Finance, said she wouldn't be surprised if TVL surpassed $5 billion by the end of the year.
The regulatory question
The reported SEC approach raises a core regulatory question: whether stock-linked tokens can scale without undermining shareholder protections. Bloomberg noted that the tokens may not provide traditional rights such as voting power or dividends. That's a departure from the legal safeguards that come with owning a regular share. Whether the SEC's framework will address those protections — and whether issuers like Ondo will be required to offer them — is the central unresolved question for tokenized equities.
