21Shares Files with SEC to Launch Spot ONDO ETF with Coinbase Custody

TLDR

• 21Shares files with SEC for an ETF tracking Ondo (ONDO) token’s performance.

• Coinbase Custody will safeguard all ONDO tokens for the proposed ETF.

• The 21Shares Ondo Trust aims to passively track ONDO without leverage or derivatives.

• ONDO token’s price rose 2.3% following the ETF filing news, reaching $1.08.

21Shares, an exchange-traded fund issuer, has submitted a filing to the U.S. Securities and Exchange Commission (SEC) for a new product focused on the Ondo token (ONDO). The proposed product, called the “21Shares Ondo Trust,” will directly hold ONDO tokens and aims to track its dollar value.

This filing marks an important step for 21Shares in expanding its range of cryptocurrency-related investment products.

The 21Shares Ondo Trust will not involve any leverage or derivatives, making it a passive investment vehicle. The primary objective is to replicate the performance of ONDO without engaging in any speculative activities. The ETF as a result will track the value of ONDO using the CME CF Ondo Finance-Dollar Reference Rate. This benchmark aggregates ONDO trade data from several leading crypto exchanges.

As part of the filing, 21Shares revealed that Coinbase Custody Trust Company will serve as the custodian for the ONDO tokens within the ETF. Coinbase Custody is a well-known entity in the crypto industry, offering secure, segregated accounts to hold digital assets.

ONDO tokens will as a result be stored primarily in cold storage to ensure maximum protection against theft and loss.

The use of Coinbase Custody adds a layer of security for investors, reassuring them that their assets will be kept safe while the ETF operates in line with traditional financial products. The filing does not specify which national exchange will list the ETF, nor has a ticker symbol been disclosed at this stage.

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After the filing for the proposed ETF, the price of ONDO saw a 2.3% increase, pushing it to $1.08. This uptick in price was likely influenced by the positive market sentiment around the potential ETF launch. As a result, ONDO’s market capitalization rose to $3.44 billion.

The news of the SEC filing has drawn attention from crypto investors and market participants, contributing to an increase in trading volume.

At the time of writing, ONDO’s total circulating supply stands at 3.1 billion tokens out of a total of 10 billion. The price of ONDO has seen a decline of 48% from its December 2024 high of $2.14, which highlights its volatility. However, with the filing of the ETF, some market analysts believe that the increased institutional interest could offer long-term price stability for the token.

Ondo Finance, the decentralized finance platform behind the ONDO token, has garnered attention for its focus on institutional-grade financial markets. Earlier in the year, Ondo Finance announced its acquisition of Oasis Pro, a registered SEC broker-dealer. This acquisition as a result could help facilitate the launch of tokenized real-world assets (RWAs), further solidifying Ondo Finance’s place in the financial ecosystem.

RWAs have seen substantial growth in the blockchain space, with the total value of tokenized assets surging to nearly $25 billion. Ondo Finance aims to leverage its layer-1 blockchain, Ondo Chain, to support tokenized securities and enable Wall Street firms to participate in decentralized finance.

With increasing interest in tokenized RWAs, the potential launch of a spot ONDO ETF could provide a more secure and regulated investment route for institutional investors. The involvement of established entities like Coinbase Custody and the SEC registration process also signal a maturation of the decentralized finance space, potentially bringing it closer to mainstream financial markets.