What the End of the SEC’s Ondo Finance Investigation Means for Tokenized Assets

The SEC has closed its multi-year investigation into Ondo Finance without recommending any charges after examining whether the firm’s tokenized US Treasuries and ONDO token violated securities laws.

As equity tokenization rises on the SEC’s agenda, the decision clears the way for Ondo to expand its operations nationwide.

SEC Quietly Closes Ondo Case

The US Securities and Exchange Commission (SEC) signaled a continued shift in its enforcement posture after news broke that it had closed its investigation into tokenization firm Ondo Finance.

Although the news became public on Monday, the dismissal occurred toward the end of last month.

According to reports, the SEC launched the probe in October 2023, under the leadership of former Chair Gary Gensler, to assess whether the firm had complied with securities laws.

Now, under current Chair Paul Atkins, the SEC has taken a more pro-crypto direction. The closure of the Ondo probe exemplifies its ongoing rollback of several high-profile cases. The SEC now adds the Ondo investigation to the list of closed cases, alongside those involving Coinbase, Ripple, and Kraken.

The move also shows heightened institutional interest in the potential of asset tokenization.

Tokenization Gains Momentum in Washington

Equity tokenization, once viewed cautiously by regulators, is now firmly on the SEC’s agenda. 

Last week, the SEC’s Investor Advisory Committee held a panel on how distributed ledgers could modernize public equity issuance and trading. It marked a notable departure from the enforcement-first posture of recent years.

That institutional appetite mirrors the traction seen in the private sector. 

Tokenized US Treasuries have become one of the fastest-growing on-chain asset categories. Meanwhile, early tokenized equity products are beginning to draw interest from global investors. 

Ondo, an early participant in the tokenization sector, was among the firms to ride this regulatory shift. The closure of the SEC investigation now removes a degree of uncertainty for the company and for others pursuing tokenized real-world assets. 

Ondo said in a blog post that the decision enables it to proceed with plans to expand its US operations, supported by its acquisition of Oasis Pro, a broker-dealer and ATS operator. 

The firm is also scheduled to host its annual Ondo Summit in New York in February. There, it’s expected to outline new tools and products focused on real-world asset tokenization.