21Shares Files for Spot Ondo Token ETF Product
21Shares has initiated the regulatory process to launch a new exchange-traded fund (ETF) focusing on Ondo, the native token of the Ondo Finance decentralized finance protocol. The asset manager submitted a preliminary prospectus to the Securities and Exchange Commission (SEC) on Tuesday, detailing the “21Shares Ondo Trust.” This trust intends to directly hold Ondo tokens and closely track their performance using the Chicago Mercantile Exchange’s (CME CF) Ondo Finance-Dollar Reference Rate. Coinbase will be responsible for securing and safeguarding the Ondo tokens held within the trust. This proposed investment vehicle is designed as a passive strategy, explicitly avoiding speculative or leveraged investments. Authorized participants will have the ability to create or redeem shares using cash transactions, or through in-kind exchanges, maintaining a straightforward and accessible mechanism for investors.
The Ondo token, or ONDO, serves as the fundamental utility token within Ondo Chain, a layer-1 proof-of-stake blockchain specifically engineered for institutional-grade financial markets. The design of Ondo Chain centers on the tokenization of real-world assets—a concept often referred to as RWAs—aiming to provide institutional investors with enhanced access to and control over these assets. Currently, the ONDO token boasts a market capitalization of $3.5 billion, reflecting a substantial level of investor interest. The circulating supply stands at 3.1 billion tokens out of a total potential emission of 10 billion. As of the latest data from CoinGecko, the token’s price is $1.12, representing a significant decline of 48% compared to its all-time high of $2.14, reached in December.
The strategic backing of Ondo Finance extends to the Trump family’s DeFi platform, World Liberty Financial. In December, World Liberty Financial executed a purchase of $250,000 worth of ONDO tokens, and the platform currently holds an impressive 342,000 tokens valued at approximately $383,000, according to on-chain data provided by Nansen. However, this ONDO holding constitutes a relatively small portion—just 0.2%—of World Liberty Financial’s overall $208 million portfolio. This portfolio is predominantly composed of stablecoins alongside wrapped Ether and Bitcoin, indicating a conservative investment approach within the broader DeFi landscape.
Notably, Ondo Finance’s ambitions extend beyond merely issuing an ETF. Earlier this month, the company completed the acquisition of Oasis Pro, a SEC-registered broker-dealer. This acquisition is a pivotal step in Ondo Finance’s strategy to launch tokenized securities, collaborating closely with Pantera Capital. Oasis Pro is already recognized by the SEC as an Alternative Trading System (ATS) and a transfer agent, signifying its status as a registered, non-exchange trading venue capable of managing security ownership. The company’s history includes membership with the Financial Industry Regulatory Authority (FINRA) since 2020, underscoring a commitment to regulatory compliance.
The underlying Ondo Chain blockchain, designed for Wall Street firms to tokenize RWAs, was officially announced in February, reflecting the platform’s core technological foundation. Concurrently, the broader ecosystem surrounding tokenized real-world assets is experiencing substantial growth. The value of assets tokenized on-chain has surged by 58% this year, reaching nearly $25 billion, according to RWA.xyz. Ethereum currently holds the largest market share in this space, accounting for 55% of the total tokenized RWA value. A significant portion of these assets—primarily private credit and U.S. Treasuries—is being tokenized on Ethereum.
Further contextualizing this trend, Bitcoin OG Willy Woo recently sold the majority of his Bitcoin holdings, a move that has sparked considerable discussion amongst market analysts seeking to understand the underlying motivations. Examining this broader financial landscape provides a crucial context for understanding the potential trajectory of the Ondo Finance ETF and the wider tokenization of real-world assets. The continued expansion of the RWA market, bolstered by innovations such as Ondo Chain, introduces a new dimension to traditional finance, offering increased liquidity and accessibility to previously illiquid assets.
