Ondo Finance is urging the United States Securities and Exchange Commission (SEC) to delay a proposed rule change by Nasdaq that would allow trading in tokenized securities.
In a letter submitted on Wednesday, the tokenization company raised concerns over what it sees as a lack of transparency and a potential threat to fair market access.
The issue centers on Nasdaq’s plan to change its rules to support trading in tokenized assets. Although Nasdaq says it expects the Depository Trust Company (DTC), the central clearinghouse for U.S. securities, to handle post-trade settlement of these tokens, details of how this would work remain vague.
It relies on Nasdaq’s “preliminary sense” of the process it says the Depository Trust Company (DTC) plans to settle securities in token form, of which no direct evidence is in the record,” Ondo wrote. “This deprives the Commission of the information necessary to determine whether the proposed rule change complies with the requirements of the Securities Exchange Act of 1934 (Exchange Act).”
Ondo, which offers tokenized products such as short-term U.S. Treasuries and exposure to U.S. stocks through blockchain-based tokens, has argued that unequal access to information favors large incumbents.
Smaller or newer businesses find themselves without the data they need to plan or respond to market changes.
Ondo says he could support Nasdaq’s plan if DTC made its process public. Until then, it is asking the SEC to open a formal review that could lead to disapproval.
