Ondo Finance has launched an in-kind conversion route that lets approved institutions mint and redeem Ondo Stocks with underlying shares through Alpaca’s Instant Tokenization Network. Summary
Ondo Finance has launched an in-kind conversion route that lets approved institutions mint and redeem Ondo Stocks with underlying shares through Alpaca’s Instant Tokenization Network.
SummaryOndo Finance said on Sept. 21 that the service is live on Ethereum and BNB Chain, adding a primary-market route alongside its existing cash-funded minting process. Access is limited to institutions approved by Alpaca case by case, and participants need active accounts with both companies before activation.
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For a mint, an approved institution transfers the underlying stock or ETF from its Alpaca account to Ondo’s Alpaca account through an internal book transfer. Ondo then issues the corresponding tokenized position on a supported blockchain. Redemption reverses the process, sending the underlying shares back to the institution’s Alpaca account after the tokens are redeemed.
JUST IN: Ondo and Alpaca launch a new way for institutions to tokenize existing stock holdingsThrough the Instant Tokenization Network, eligible institutions can convert locked shares into onchain tokens redeemable for the underlying assets across Ethereum and BNB Chain. pic.twitter.com/Px8O9A0A51
— crypto.news (@cryptodotnews) September 21, 2026
Ondo said the integration removes the need for manual approval on each individual conversion. The company described the feature as a way for market makers to move existing inventory between traditional brokerage accounts and onchain venues without funding every token mint with separate cash.
The institutional route does not change the general terms for ordinary Ondo Stocks holders. Ondo’s current product documentation says the tokens are offered only to eligible non-U.S. persons through its platform and are unavailable there to U.S.-based clients. Ondo says its tokenized stocks provide economic exposure to referenced securities but are not themselves stocks, ETFs or ADRs and do not automatically give holders the right to receive the underlying securities.
Alpaca makes a similar distinction in its own tokenization disclosures. Its Instant Tokenization Network can create and burn tokens against brokerage-held shares, while third parties perform the tokenization. Alpaca states that tokenized assets generally provide economic exposure to equities and do not represent direct ownership of the underlying company unless a particular structure says otherwise.
The new Ondo arrangement creates a specific exception for institutions admitted to the conversion program. Approved firms can redeem their Ondo Stocks tokens through the ITN process and receive the corresponding shares back into their Alpaca accounts. Access therefore depends on institutional approval and the required accounts, not simply possession of the token.
Before this launch, an institution using Ondo’s cash-funded route could already own the underlying shares yet still need separate cash to mint matching Ondo Stocks tokens. Ondo said the new setup lets an approved participant contribute shares it already holds, removing the extra funding step.
The company said the model could reduce financing costs and timing mismatches when market makers need more tokenized inventory. Ondo described the expected outcome as “tighter spreads and deeper liquidity” in secondary markets, but it did not publish an independent spread study or post-launch liquidity figures alongside the announcement.
Alpaca describes ITN as infrastructure for instant in-kind minting and redemption against stocks held through brokerage accounts. Its platform says the network is designed to create and burn tokens against those shares without waiting for conventional settlement processes. Alpaca Clearing provides securities brokerage and custody and is a FINRA-regulated broker-dealer.
Conversions under the Ondo integration currently cover Ethereum and BNB Chain. Ondo Stocks themselves have a larger network footprint: Ondo’s product page lists Ethereum, BNB Chain and Solana, while its current website advertises more than 450 tokenized stocks and ETFs. The Sept. 21 in-kind announcement did not include Solana among supported conversion networks.
Onchain data shows Ondo operating at a larger scale than the new conversion feature alone. RWA.xyz recorded $3.63 billion in distributed asset value for the Ondo platform as of Sept. 22, alongside 441 tracked products and 485,296 holder addresses. Monthly transfer volume stood at $1.58 billion.
The $3.63 billion figure covers RWA.xyz’s tracked Ondo platform assets and should not be treated as the value of Ondo Stocks alone. Network data on the same dashboard showed roughly $2 billion of Ondo assets on Ethereum, $407.1 million on BNB Chain and $300.6 million on Solana, with other Ondo assets distributed across several networks.
Ondo said in May that its tokenized stock platform had passed $1 billion in total value locked after launching in September 2025. At that point, the company reported more than 260 tokenized U.S. stocks and ETFs and $18 billion in cumulative trading volume. By June, Ondo said cumulative trading volume had moved beyond $20 billion.
Distribution has expanded through exchanges, wallets and DeFi protocols. As crypto.news reported, Ondo extended a group of tokenized U.S. stocks and ETFs to Hyperliquid’s HyperEVM, with 35 assets initially supported through that integration.
In related coverage, crypto.news reported that MetaMask had integrated more than 200 Ondo tokenized U.S. stocks and ETFs earlier in 2026, giving eligible mobile users access from inside the wallet.
The launch follows a Sept. 17 U.S. Securities and Exchange Commission order creating temporary, conditional exemptions for certain Tokenized Securities Venues. The framework permits qualifying venues to facilitate trading in tokenized National Market System stocks through permissioned automated market maker liquidity pools, subject to specified conditions.
Among the SEC’s conditions, a venue must verify that a tokenized NMS stock provides the same rights and privileges as the equivalent traditional stock. The framework requires notice to an underlying issuer for tokens created by an unaffiliated party, auditable public smart contracts and trading suspensions when the underlying stock is halted.
Ondo did not state that the Alpaca in-kind service operates under the SEC’s Innovation Exemption. Its current Ondo Stocks platform remains unavailable to U.S. persons through the main product unless registration or another applicable exemption permits an offering.
The company has pursued a separate U.S. regulatory path. In April, Ondo submitted a no-action request asking the SEC for assurance concerning a model where Ethereum would record tokenized security entitlements while Alpaca’s offchain books remained the official ledger. The proposal said underlying securities would remain within the existing brokerage and DTC custody structure.
Ondo described the Ethereum tokens as an operational layer over existing securities entitlements instead of a replacement for the regulated brokerage record.
Another infrastructure step came on Sept. 16, when DTCC confirmed that Ondo subsidiary Oasis Pro Markets had joined Fund/SERV as its first tokenization-platform member. DTCC said Fund/SERV processes transactions covering more than 85% of U.S. mutual fund activity, while Oasis Pro Markets is a U.S.-registered broker-dealer and FINRA member.
For the new Alpaca conversion route, Ondo has not announced a separate fee schedule, minimum conversion size, Solana activation date or timetable for opening ITN access more generally. Institutions seeking the service must maintain accounts with Ondo and Alpaca, complete the applicable onboarding process and request activation from both firms.
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