Institutions Can Now Turn their Shares Into Ondo Stocks

@Ondo Finance has expanded its tokenized equities platform with a new in-kind conversion mechanism built alongside broker-dealer @AlpacaHQ, giving approved institutions a direct route to mint and redeem Ondo Stocks tokens using shares they already hold.

How the In-Kind Process Works

The new route is powered by @AlpacaHQ's Instant Tokenization Network (ITN). It enables approved institutions to contribute existing shares to mint corresponding Ondo Stocks tokens, or redeem tokens to receive the underlying shares. To mint, an institution transfers underlying shares from its Alpaca account to Ondo's Alpaca account via an internal book transfer, and the corresponding tokens are issued on the supported blockchain. Redemption reverses the process, returning shares to the institution's Alpaca account in exchange for the tokens.

The integration automates the conversion process, removing the need for manual approval on each transaction and allowing institutions to move quickly between traditional share inventory and tokenized positions. Access is not open to all: eligibility is limited to institutions approved by Alpaca on a case-by-case basis, and ITN is not a generally available Ondo Stocks feature. Both @Ethereum and @BNBChain are supported.

Adding to an Existing Liquidity Model

The in-kind route sits alongside Ondo's existing cash-based system. Ondo Stocks delivers liquidity through a just-in-time model it pioneered, enabling instant, low-cost minting and redemption that taps directly into the deeper liquidity of traditional markets like Nasdaq and NYSE, rather than relying on pre-funded on-chain pools. The addition of in-kind conversion allows institutions to convert existing share inventory directly into on-chain liquidity, supporting tighter spreads and deeper liquidity for Ondo Stocks across secondary markets.

The announcement reflects the growing scale of Ondo's tokenized equities business. Ondo Stocks has grown to more than $1 billion in TVL and continues to scale. @AlpacaHQ is a central piece of that infrastructure: Alpaca clears or custodies roughly 94% of tokenized U.S. equities, including products connected to Binance, Ondo, and Dinari, and holds more than $1.5 billion of underlying stocks backing tokenized equities.

Demand for tokenized equities has surged as investors look to bridge structural gaps in legacy finance, with the total value locked in tokenized U.S. equities approaching $2 billion as of July 2026. The in-kind mechanism is the latest step in making that market more efficient for the institutional participants who anchor its liquidity.

Sources:
Ondo Finance official press release: In-Kind Conversion Launch (PR Newswire)
Alpaca raises $135 million for tokenized stock infrastructure (CoinDesk)
How Ondo Stocks is bringing institutional-grade tokenized equities to global investors (Alpaca)