Ondo Finance Launches In-Kind Stock Tokenization for Institutions on Ethereum and BNB Chain

TLDR

• Ondo Finance launched an in-kind conversion system letting approved institutions mint tokenized stocks using actual shares instead of cash
• Conversions are live on Ethereum and BNB Chain through Alpaca’s Instant Tokenization Network
• The system removes the need for separate cash funding when minting tokenized positions
• Ondo has $3.63 billion in distributed assets across 441 products as of September 22
• Access is restricted to institutions approved by Alpaca on a case-by-case basis

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Ondo Finance has launched a new way for approved institutions to convert real stocks and ETFs directly into tokenized versions on the blockchain. The service went live on September 21 and runs on Ethereum and BNB Chain.

🚨ONDO SHOW HOW THEY MADE TOKENISED STOCKS FAR MORE LIQUID!

Institutions can now turn shares they already own directly into @Ondo Stocks tokens and convert them back again.$ONDO is building the bridge between Wall Street and onchain markets. pic.twitter.com/OzUTvxesdr

— ALLINCRYPTO (@RealAllinCrypto) September 21, 2026

Before this update, institutions using Ondo’s cash-funded model had to provide separate cash to mint tokenized stocks, even if they already held the underlying shares. The new in-kind route removes that step.

How the Conversion Works

An approved institution transfers shares from its Alpaca brokerage account to Ondo’s Alpaca account through an internal book transfer. Ondo then issues the matching tokenized position on a supported blockchain.

The process works in reverse too. Institutions can redeem their tokenized stocks and receive the underlying shares back into their Alpaca accounts.

Ondo said removing the separate cash step could lower financing costs and reduce timing mismatches for market makers managing tokenized inventory.

The company also said the change could lead to tighter spreads and deeper liquidity in secondary markets, though it did not publish independent data to support that claim at launch.

Access and Eligibility

Only institutions approved by Alpaca on a case-by-case basis can use the new conversion route. Participants need active accounts with both Ondo and Alpaca before activation.

The new feature does not change anything for regular Ondo Stocks holders. Ondo Stocks remain available only to eligible non-U.S. persons and are not available to U.S.-based clients through the standard platform.

Ondo and Alpaca both note that tokenized stocks provide economic exposure to the referenced securities but do not represent direct ownership of the underlying company unless a specific structure states otherwise.

The in-kind conversion creates an exception for admitted institutions, who can redeem tokens and receive actual shares back through Alpaca.

Ondo’s tokenized stocks platform covers more than 450 products, including U.S. stocks and ETFs. The in-kind conversion currently supports Ethereum and BNB Chain, and Solana was not included in the September 21 announcement.

Platform Scale

RWA.xyz data shows Ondo had $3.63 billion in distributed asset value across 441 products and 485,296 holder addresses as of September 22. Monthly transfer volume stood at $1.58 billion.

Ondo said in May that its tokenized stock platform passed $1 billion in total value locked after launching in September 2025. Cumulative trading volume passed $20 billion by June 2026.

Distribution has grown across exchanges, wallets and DeFi protocols. MetaMask integrated more than 200 Ondo tokenized U.S. stocks and ETFs earlier in 2026. Ondo also extended tokenized assets to Hyperliquid’s HyperEVM, with 35 assets supported through that integration.

On September 17, the SEC issued a temporary framework for tokenized securities venues. Ondo did not state that the Alpaca in-kind service operates under that exemption.

On September 16, DTCC confirmed that Ondo subsidiary Oasis Pro Markets joined Fund/SERV as its first tokenization-platform member.