Ondo Finance Introduces In-Kind Stock-to-Token Conversion for Institutions
Ondo allows stock-to-token conversion
Ondo Finance has introduced a new in-kind conversion system that lets eligible institutions turn stocks and exchange-traded funds (ETFs) directly into their tokenized equivalents, or redeem the tokens for the underlying shares. ETFs are funds that hold a basket of assets and trade on exchanges like individual stocks.
Under the new process, approved institutions can transfer shares from their Alpaca accounts to Ondo through an internal book transfer. Ondo Stocks tokens are then issued on a blockchain. The system also works in reverse, allowing redemption of tokens for the underlying shares.
What the in-kind option changes
The new in-kind option adds to Ondo’s existing cash-funded model, where an institution that already holds the underlying shares must still provide separate cash to mint the corresponding tokens. With the in-kind route, institutions can use the shares they hold instead, potentially reducing the additional capital needed to create tokenized inventory.
Ondo said the change could also lower financing costs and reduce timing mismatches between traditional shares and tokenized positions.
The conversions are currently available on Ethereum and BNB Chain. Access is limited to institutional clients approved by Alpaca, and participants need active accounts with both Alpaca and Ondo.
Ondo's position in tokenization
Ondo has grown into one of the largest tokenization platforms by onchain value. Data from RWA.xyz shows about $3.63 billion in distributed assets across 441 products, ranking it second behind Securitize.
Sources
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