Ondo Private Markets opens with tokenized pre-IPO AI company notes

Ondo Finance opened a platform on Tuesday for trading tokenized notes tied to private companies, starting with an unnamed pre-IPO artificial intelligence firm. The notes are not stock. Only people outside the United States can buy them.

Secondary trading will start this week, the company said in an October 6 statement, under the name Ondo Private Markets. Its existing tokenized Treasury and stock products hold about $3.7 billion across more than 1 million holders.

What the tokens actually are

Each note is a promise from an Ondo entity, not a share in the company it tracks. The payout is tied to the per-share value the company reaches at a qualifying liquidity event, such as an initial public offering or a sale. Holders get no ownership, no vote and no other shareholder rights. The notes trade freely onchain, around the clock, with no approval needed for each transfer. They can also plug into other onchain apps, because Ondo built them to behave like any other token. Think of it as closer to an IOU than a share certificate.

A buyer carries that risk. A return depends on an exit that may never come, on a timeline no one can set. If the company stays private for years, the note just sits there.

Ondo built the product on the same rails behind its tokenized Treasury and stock funds. The firm groups these new notes under its wider push into tokenized real-world assets, the catch-all for bonds, funds and equities issued as blockchain tokens.

Who can buy, and who cannot

The tokens are off-limits to anyone in the United States. They are not registered under the US Securities Act of 1933, and Ondo says US persons cannot subscribe to, buy or redeem them. That leaves a US company selling private-market exposure its own retail market cannot legally touch.

Ian De Bode, Ondo's acting chief executive and president, framed the launch around that gap. "In the US, the majority of the investment options accessible for retail are public companies, yet 87% of companies with over $100m in revenue are private," he said. His argument rests on a real shift. Big firms now stay private far longer than they once did, so much of their growth lands before any public listing.

Access is the selling point. The catch is what a buyer holds: a claim on a future payout, not a seat at the table, and no say in how the company is run. The gap he describes is real. Whether a note that confers no ownership narrows it is less clear.

A crowded and contested idea

Ondo is not first to this trade. Tokenized pre-IPO products already run on other chains. PreStocks issues Solana-based tokens tracking firms like OpenAI and SpaceX. Binance added a pre-IPO row to its Web3 wallet this year, reaching a wallet base of about 270 million users, and Hecto Finance is building an onchain index of giant private firms. Most of these products share one trait: the companies they track have not signed off on them. The idea also mirrors wider moves to put regulated markets onchain, like OKX and the NYSE parent's plan for a 24/7 tokenized US stock venue.

That history carries a warning. When Robinhood and others issued tokens tied to OpenAI, the company said flatly that they were not its equity. "These 'OpenAI tokens' are not OpenAI equity," OpenAI said, adding that it did not endorse the sale. After OpenAI and Anthropic warned that unauthorized share transfers could be void, PreStocks tokens tied to OpenAI fell 46%, according to The Block.

Ondo has not named its AI company. It has also not said whether that company agreed to the product or had any part in it. Without the name, a buyer cannot check the underlying valuation or confirm the firm signed off. Private companies disclose little as it is, and a note adds a second layer between the holder and the business.

What to watch

Liquidity is the first test. Ondo promised round-the-clock secondary trading this week, and thin volume would undercut the pitch. Watch whether Ondo names the AI company and confirms it signed off, which would set this apart from the disputed tokens that came before.

Ondo says robotics, cybersecurity, biotech and infrastructure firms will follow. No dates. No names yet. For now there is one note, tied to a company the market cannot see.