Ondo Finance, a platform for tokenizing real-world assets (RWA), has filed an application with the U.S. Securities and Exchange Commission (SEC) regarding its Ondo Global Markets (OGM) product.
Accordingly, Ondo Finance has requested a regulatory comment from the SEC regarding its security tokenization product using Ethereum (ETH).
At this point, OnDo Finance sent a letter of confirmation to the SEC stating that it would not be subject to sanctions. A letter of confirmation that a company will not be subject to sanctions (enforcement measures) is a procedure where the company receives prior assurance from authorities that it will not be subject to sanctions, even if there is a possibility of a regulatory violation related to a particular business model or behavior.
OGM continues to offer tokenized bonds, which provide investment opportunities in US equities and ETFs, to investors outside the US. And the underlying securities and records of these bonds are held by BitGo.
The regulation proposed in the SEC filing aims to register tokenized securities on the Ethereum mainnet under certain conditions.
OnFinance plans to continue holding physical assets of its stocks and ETFs through the US Depository and Clearinghouse (DTC) and managing them through the US brokerage firm Alpaca.
However, Ondo Finance plans to address investors’ “securities rights” by issuing them as tokens on Ethereum. In other words, in the model proposed by Ondo Finance, while the physical underlying assets remain on the existing financial infrastructure, only the securities rights and transaction records are transferred to the blockchain. At this point, Ondo Finance states that it will create tokens on Ethereum representing the underlying equity rights. Ondo believes this will increase the efficiency and transparency of asset management.
*This is not investment advice.
