Ondo Finance is urging the US Securities and Exchange Commission (SEC) to delay a rule change proposed by Nasdaq that would allow trading in tokenized securities.
In a letter sent on Wednesday, the tokenization company expressed concerns about what it sees as a lack of transparency and a potential threat to fair market access.
The issue centers on Nasdaq’s plan to amend its rules to support trading in tokenized assets. While Nasdaq says it expects the Depository Trust Company (DTC), the central clearinghouse for US securities, to handle post-trade settlement of these tokens, the details of how that would work remain vague.
It is based on Nasdaq’s “preliminary sense” of the process it understands the Depository Trust Company (DTC) is contemplating to liquidate securities on a token basis, of which there is no direct evidence in the record,” Ondo wrote. “This deprives the Commission of the information necessary to determine whether the proposed rule change is consistent with the requirements of the Securities Exchange Act of 1934 (Exchange Act).”
Ondo, which offers tokenized products such as short-term US Treasuries and exposure to US stocks through blockchain-based tokens, argued that unequal access to information favors large holders.
Smaller or newer businesses are left without the data they need to plan or respond to market changes.
Ondo says he could support Nasdaq’s plan if DTC makes its process public. Until then, it is asking the SEC to open a formal review that could lead to its disapproval.
