Background and Solution Overview
Ondo Finance announced a collaboration with Broadridge Financial Solutions (NYSE: BR) to launch the first third-party operated, custody-based tokenized US securities solution within the existing US regulatory framework. This is the first time a US-listed security has been tokenized by a third party on a public blockchain while fully complying with SEC regulations and infrastructure requirements. The tokenized assets include BlackRock's iShares Core S&P 500 ETF (IVV) and Micron Technology (MU) stock. The tokens are issued on the Ethereum blockchain and backed 1:1 by regulated custodians, ensuring the underlying securities remain within the traditional regulated custody chain.
Regulatory Compliance and SEC Framework
The solution strictly follows the third-party custody model described in the SEC's January 2026 statement on tokenized securities. Ondo emphasized that all tokenization processes are designed within the current US securities law framework, preserving blockchain transparency and programmability while ensuring asset safety through traditional custodians. This model offers a reproducible compliance template for other financial institutions exploring tokenized assets, potentially accelerating the convergence of traditional finance and decentralized finance (DeFi).
Token Holder Rights and Services
Broadridge will leverage its ProxyVote.com platform to provide token holders with proxy voting, issuer communications, and regulatory disclosure services. This means token holders enjoy the same shareholder rights and protections as traditional securities investors, including participation in corporate governance decisions, access to financial reports, and receipt of material event notices. Ondo stated that this design addresses the pain point of tokenized securities being merely "tokens without substance," truly unifying asset ownership with on-chain liquidity.
Market Significance and Outlook
This partnership represents a crucial step toward tokenization in US capital markets. As one of the largest global financial infrastructure service providers, Broadridge's involvement provides robust operational support for institutional-grade tokenization. Ondo, which has previously launched tokenized yield products (OUSG, OUSD), is now expanding into stock and ETF tokenization, broadening the range of real-world assets (RWA) on blockchains. With the SEC's regulatory framework becoming clearer, more traditional financial institutions are expected to emulate this custody model, driving trillions of dollars in traditional assets onto blockchain networks.