Key Highlights
- Ondo submitted its SEC comment letter on August 11 on proposed changes to Regulation NMS.
- The company supports rescinding Rules 611 and 610(e) but wants tokenized securities included in the SEC’s market-structure analysis.
- Ondo asked the SEC to recognize completed request-for-quote (RFQ) execution for traditional and tokenized stocks.
Ondo Finance has asked the U.S. Securities and Exchange Commission (SEC) to account for tokenized securities and blockchain-based trading infrastructure as it considers changes to long-standing U.S. equity market rules.
The company submitted its comment letter on Tuesday in response to the SEC’s proposal to rescind Rules 611 and 610(e) of Regulation NMS. In an X post, Ondo announced the filing on Wednesday.
Ondo supports removing both rules but argues that the SEC’s replacement framework should reflect the emergence of alternative execution models and tokenized securities alongside traditional stock markets.
The SEC’s comment period remains open until August 17, 2026.
What the SEC is proposing
Rule 611, commonly known as the trade-through rule, generally prevents trading centers from executing orders at prices worse than protected quotations displayed elsewhere in the national market system.
Rule 610(e) addresses restrictions involving locked and crossed quotations.
The SEC has proposed rescinding both provisions, along with related definitions and conforming requirements. The proposal is part of a broader review of U.S. equity market structure and is not specifically focused on crypto or tokenized assets.
That broader scope is central to Ondo’s argument. The company says the SEC should consider how newer trading and settlement systems could operate if the existing rules are removed.
Ondo pushes for RFQ execution
One of the filing’s main requests is for the SEC to recognize completed request-for-quote (RFQ) execution as an alternative to continuous order-book trading. Under an RFQ model, an investor requests prices from multiple liquidity providers and can execute against the most favorable quote.
Ondo pointed to the use of RFQ in markets such as U.S. Treasuries, corporate bonds, and European ETFs, arguing that the model could also be relevant to tokenized equities. The company wants the SEC to provide clearer guidance on how RFQ-based execution can satisfy best-execution requirements after Rule 611 is rescinded.
The argument is particularly relevant to tokenized markets, where liquidity can be spread across different blockchain networks, regulated venues, and other trading systems.
Tokenized stocks are entering U.S. market infrastructure
Ondo’s filing also argues that recent developments in tokenized securities should be reflected in the SEC’s economic analysis. The company pointed to the regulator’s approvals allowing Nasdaq and NYSE to support tokenized versions of certain stocks and ETFs through DTC-linked infrastructure.
At the same time, other tokenized securities platforms are developing models involving transfer agents and blockchain-based settlement outside the traditional DTC structure. Ondo argues that these developments create a market in which traditional equities and tokenized versions of those securities can operate alongside one another.
That raises questions around execution, settlement, interoperability, and investor protections that were not part of the market when Regulation NMS was originally adopted.
Ondo’s recent expansion gives context to the filing
The filing comes shortly after Ondo expanded its own regulated infrastructure for tokenized securities.
On July 23, Ondo’s broker-dealer subsidiary, Oasis Pro Markets, received SEC and FINRA approvals covering tokenized stocks and funds. The approvals allow the platform to support activities including trading and settlement of tokenized securities, with transactions capable of settling in fiat currencies or supported stablecoins.
Four days later, on July 27, Ondo launched the Ondo Network, an execution network designed to separate trade execution from onchain settlement.
These developments are relevant to the SEC filing because Ondo is seeking clearer rules for both tokenized securities and the infrastructure used to trade and settle them.
Ondo seeks clarity for non-custodial infrastructure
Another request concerns software that connects tokenized securities with regulated financial markets. Ondo asked the SEC to clarify whether fixed-logic, route-agnostic, and non-custodial infrastructure can operate without broker-dealer, exchange, or clearing-agency registration when it does not take custody, match orders, or settle transactions.
The request builds on an April 2026 SEC staff statement concerning certain user interfaces used with crypto asset securities. Ondo argues that similar principles should be considered for tokenized NMS stocks.
The broader regulatory question is where the SEC should draw the line between software infrastructure that facilitates transactions and activities that constitute regulated financial-market functions.
Clearing and settlement add another layer
The filing also highlights the potential complications created by multiple settlement systems.
Traditional equities generally rely on established market infrastructure, while tokenized securities can involve blockchain-based transfers, transfer agents, and DTC-linked arrangements.
As these systems develop, market participants could face questions around how ownership records are synchronized, how assets move between systems, and how clearing arrangements interact.
Ondo is not asking the SEC to resolve all of those issues through the current Regulation NMS proposal. Instead, it wants the agency to account for the emerging infrastructure when assessing the future of U.S. equity markets.
Onchain trading costs remain higher
Ondo highlighted the cost gap between traditional equities and tokenized markets. It said regulated U.S. brokers can offer spreads below 1 basis point, while fees on automated market makers (AMMs) — the algorithm-driven liquidity pools commonly used to trade tokenized assets — for tokenized equities can reach roughly 30 basis points, before blockchain costs.
Ondo argues that competitive RFQ execution could help narrow this gap.
The company also acknowledged its commercial interest in the issue. Its filing says Ondo Global Markets offers 430+ tokenized stocks and ETFs, with over $1 billion in TVL and more than $20 billion in cumulative trading volume since September 2025.
That exposure means changes to U.S. rules on execution and settlement could directly affect Ondo’s tokenized-securities business.
Ondo has previously weighed in on tokenized-stock rules
No independent market-structure analyst or competing tokenization platform had publicly commented on Ondo’s latest filing at the time of publication.
Ondo has previously submitted comments on tokenized-securities regulation. In October 2025, the company asked the SEC to delay or reject a separate Nasdaq proposal for trading tokenized stocks, citing limited information about how the Depository Trust Company (DTC) would handle tokenized settlement.
Ondo did not disclose in that filing how the Nasdaq proposal would have affected its own platform.
Investor protection remains part of the debate
The SEC’s proposed removal of Rule 611 could affect how trading venues compete, how orders are routed, and how execution quality is assessed. SEC officials have sought public feedback on questions surrounding best execution, transparency, and market quality under a framework without the existing trade-through requirements.
For tokenized securities, those questions become more complicated because investors could potentially access the same underlying securities through traditional exchanges and blockchain-based venues using different execution and settlement mechanisms.
The regulatory challenge is therefore not simply whether stocks can be represented on a blockchain, but how those markets can operate while maintaining consistent investor protections.
SEC now weighs competing views
Ondo’s filing puts tokenized equities into the broader debate over the future structure of U.S. stock markets. The company supports rescinding Rules 611 and 610(e), while asking the SEC to address RFQ execution, tokenized settlement and the regulatory treatment of non-custodial infrastructure.
The agency has not adopted any of Ondo’s recommendations. They remain part of the public comment process, alongside submissions from exchanges, trading firms, investors and other market participants.
With comments due August 17, the SEC will now consider the competing views before deciding whether and how to finalize the Regulation NMS changes.
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