21Shares, one of the world’s leading issuers of crypto exchange-traded products (ETPs), has filed a Form S-1 registration statement with the U.S. Securities and Exchange Commission (SEC) to launch the 21Shares Ondo Trust, an ETF that will hold ONDO, the native token of the real-world asset (RWA) tokenization platform Ondo Finance.
The filing, submitted on July 22, 2025, marks a historic moment not just for Ondo but for the broader DeFi and RWA sectors, as it may become the first ERC-20-based spot ETF approved by U.S. regulators. Unlike layer-1 networks like Ethereum or Solana, ONDO is an application-layer asset designed specifically to facilitate access to tokenized Treasuries, bonds, and other yield-generating real-world financial products.
According to the filing, the 21Shares Ondo Trust will function as a passive investment vehicle, meaning it is designed to track ONDO’s price performance without employing leverage, derivatives, or active trading strategies. The ETF will use the CME CF Ondo Finance-Dollar Reference Rate as its pricing benchmark, and the Coinbase Custody Trust Company will act as the asset custodian.
The proposed ETF’s design echoes recent SEC-approved spot Bitcoin ETFs, which maintain a simple one-to-one structure between underlying assets and ETF shares. However, unlike Bitcoin or Ethereum, ONDO represents a more nuanced layer of DeFi tied directly to U.S. Treasury yields and the tokenization of traditional assets - a narrative increasingly popular with institutions.
While the filing did not specify which exchange the ONDO ETF will be listed on, such information is expected to be disclosed in future amendments, pending regulatory clearance.
Market Signals: ONDO Price and Capitalization Surge
The timing of the filing is notable, as ONDO’s price and market capitalization have surged significantly in recent weeks. Data from BeInCrypto and CoinGecko shows that ONDO gained 64.7% over the past month, with a 6.47% daily gain bringing its current trading price to $1.12.
The token’s market cap has ballooned from $2 billion to over $3.5 billion, signaling increasing retail and institutional interest. ONDO’s growth has also outpaced the broader crypto market during the same period, making it a standout performer.
This price action appears to reflect not only speculative momentum but also growing confidence in tokenized RWA platforms as viable bridges between DeFi and traditional finance. Ondo Finance has attracted attention for its innovative approach to issuing yield-bearing stablecoins and tokenized U.S. Treasuries, often cited as early building blocks for the “on-chain financial system.”
The significance of 21Shares’ ETF filing lies not only in the potential listing of ONDO, but in the broader implications for tokenized real-world assets. ONDO is not a general-purpose layer-1 token or memecoin. Instead, it is directly tied to the performance of a protocol offering tokenized access to traditional fixed-income instruments. Ondo Finance’s flagship products include:
- OUSG: A tokenized wrapper for U.S. Treasury securities
- USDY: A yield-bearing stablecoin backed by short-duration U.S. government debt
- Flux Finance: A decentralized lending protocol focused on RWA collateral
These initiatives align with the growing demand for on-chain exposure to low-risk, yield-generating traditional instruments - especially as decentralized finance seeks to prove its relevance beyond speculation.
The 21Shares Ondo Trust, if approved, would open the door to institutional access to RWA tokens through traditional investment channels, including retirement accounts, mutual funds, and pension portfolios.
Industry Reactions: “Next Institutional Darling”?
Market commentators quickly reacted to the filing, with many suggesting it could usher in a new wave of institutional capital into the ONDO ecosystem.
“IMO: This is the first ERC-20-based spot ETF application and will open the door to more non-L1 blockchain assets to list as ETFs,” wrote analyst Marty Party.
“ONDO is the next institutional darling,” claimed trader and strategist Jeff Cook, who noted that “smart money” has already begun accumulating ONDO in anticipation of the ETF’s potential approval.
Bloomberg’s senior ETF analyst Eric Balchunas also weighed in humorously on the increasing pace of altcoin ETF filings, stating:
“NGL had to Google it. Same with the Injective one. The filings are outpacing human awareness.”
His comment underscores just how quickly the ETF pipeline is expanding. In addition to ONDO, 21Shares has filed for ETFs tracking other altcoins including Polkadot, XRP, Solana, and Sui. Each represents a unique facet of the evolving crypto landscape - from smart contract infrastructure to tokenized finance and beyond.
Regulatory Landscape: SEC’s Growing Openness to Crypto ETFs
The ONDO ETF filing follows a wave of SEC approvals for spot Bitcoin ETFs in January 2025, and subsequent momentum for Ethereum ETFs in May and June. While previous SEC administrations took a combative approach to crypto, the current regulatory climate appears incrementally more open to alternative asset structures, particularly those with clear utility and compliance frameworks.
Ondo Finance has made transparency a priority, offering investor disclosures, attestation reports, and real-time asset backing information for its products. This may play in its favor as regulators scrutinize the ONDO ETF’s structure and compliance history.
If approved, the ONDO ETF would not only mark the first spot ETF for an ERC-20 application-layer token but also test how far U.S. regulators are willing to go in legitimizing on-chain access to traditional financial markets.
What's Next for ONDO and 21Shares?
Approval of the 21Shares Ondo Trust could act as a massive catalyst for ONDO’s price and adoption, similar to how BlackRock’s iShares Bitcoin Trust sparked new inflows and legitimacy for BTC.
However, even in the absence of immediate SEC approval, the filing signals that ONDO - and by extension, real-world asset tokenization - has officially entered the radar of institutional investors and regulated financial product providers.
21Shares continues to position itself as the most aggressive crypto ETP issuer globally, with dozens of products already live in Europe and now making a serious push into the U.S. market. The firm is also among the first to test the viability of wrapping yield-bearing crypto tokens into regulated investment products.
For now, investors will be watching closely as the SEC reviews the ONDO filing. Whether or not it receives near-term approval, the momentum suggests one thing: RWA tokens are no longer a fringe concept - they’re the next frontier in crypto ETFs.