Ondo Finance said on Oct. 6 that it has launched Ondo Private Markets, a product that uses tokenized notes to give investors on-chain economic exposure to leading private companies.
The first offering will focus on a private artificial intelligence company, described as a pre-IPO AI company. Secondary market trading is expected to open this week. After that, Ondo Private Markets plans to expand to private companies in robotics, cybersecurity, biotechnology, and infrastructure.
Tokens are not equity in the underlying company
Ondo said the tokens are not shares or stock in the company itself. Instead, the tokenized notes are designed to give holders economic exposure to the value performance of a reference company’s common stock in a qualifying liquidity event, such as an initial public offering or an acquisition.
According to the company, the tokens can be transferred freely on-chain and can also be used with DeFi applications.
Built on Ondo’s existing on-chain asset infrastructure
Ondo said the product is based on its current on-chain asset infrastructure. Its tokenized stocks and U.S. Treasury platform currently have about $3.7 billion in total value locked, or TVL, and more than 1 million cumulative holders.
Targeting access to private market growth
Ondo Finance said most large U.S. companies still remain private. Among companies with more than $100 million in annual revenue, about 87% are not publicly listed. The company said traditional investors often have limited access to the early growth phase of those businesses.
Ondo Private Markets is intended to offer a more flexible trading channel through blockchain-based secondary markets, allowing eligible investors to adjust their private market exposure around the clock.