- Ondo Finance asks SEC to delay Nasdaq’s proposal for trading tokenized securities.
- The delay is requested until the Depository Trust Company (DTC) reveals settlement details.
- Ondo Finance SEC letter argues lack of DTC transparency creates unfair competition.
Ondo Finance is urging the U.S. Securities and Exchange Commission (SEC) to delay approval of Nasdaq’s proposal to trade tokenized securities. In an open letter, Ondo argues the plan should not proceed until the Depository Trust Company (DTC) publicly discloses crucial details about how tokenized settlements will work.
The DeFi firm, a leader in tokenized real-world assets (RWAs), contends that approving Nasdaq’s plan without this transparency would hinder fair competition. The Ondo Finance SEC letter stresses that while tokenization can modernize finance, it must be built on open standards and equal access to information..
Why Ondo Says the Nasdaq Plan Lacks Key Data
Nasdaq filed its proposal (SR-NASDAQ-2025-072) in early September, outlining rule changes to allow tokenized versions of stocks and ETFs to trade alongside traditional shares. However, Ondo points out that Nasdaq’s filing relies on its “preliminary understanding” of DTC’s tokenized settlement system, which is still under development and not publicly detailed.
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Ondo argues this lack of factual evidence prevents the SEC, market participants, and investors from properly evaluating the proposal. Without knowing DTC’s specific rules, policies, and procedures for handling tokenized settlements, including alternative arrangements if standard processes fail, the SEC cannot determine if the plan complies with the Securities Exchange Act of 1934.
The Uneven Playing Field: Information Asymmetry
A core argument in the Ondo Finance SEC letter is that Nasdaq appears to have privileged access to non-public information from the DTC regarding its settlement plans. This information asymmetry creates an unfair advantage for Nasdaq and potentially other large incumbents over smaller, digital-native firms looking to compete in the tokenization space.
Ondo warns this lack of transparency imposes undue burdens on newer entrants, discourages innovation, and limits market diversity. As a self-regulatory organization (SRO), Nasdaq has a duty to ensure its rules promote equal access, not hinder it.
Call for Open Standards and Regulatory Action
Ondo Finance, which operates platforms for tokenized U.S. Treasuries (OUSG) and tokenized equities (Ondo Global Markets), believes the future of tokenization should be built collaboratively on open standards. Public disclosure of DTC’s settlement framework is vital for all market participants to prepare for integration, ensure compliance, and foster fair competition.
Ondo has formally requested the SEC to postpone its decision on Nasdaq’s proposal. The firm urges the Commission to initiate proceedings to compel the DTC to publicly release details of its tokenized settlement system. Ondo states it is prepared to reconsider its position and potentially support Nasdaq’s proposal once this critical information is available to all market players.
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