Ondo’s IVVon Growth Shows What Tokenized ETFs Are Really Competing On
Ondo Finance’s tokenized version of BlackRock’s iShares Core S&P 500 ETF has become the largest tokenized ETF by market capitalization, reaching $69.6 million after starting 2026 at roughly $22 million.
Summary:
- IVVon has become the largest tokenized ETF by market capitalization.
- Its value has more than tripled since the beginning of 2026.
- The token represents exposure to BlackRock’s iShares Core S&P 500 ETF.
- Competition is increasingly centered on distribution, liquidity and DeFi usability.
IVVon has moved ahead of tokenized products including IBITon at $47.8 million and Backed’s SPYx at $47.6 million, a ranking that matters less for the absolute dollars involved than for what it reveals about the emerging competition to distribute traditional securities through blockchain infrastructure.
IVVon Has More Than Tripled Without the S&P 500 Doing the Same
The most revealing part of IVVon’s rise is not the $69.6 million headline.
Moving from roughly $22 million at the start of the year to $69.6 million represents an increase of about 216%, or slightly more than three times the starting value.
The underlying iShares Core S&P 500 ETF has obviously not appreciated by anything close to that amount.
BlackRock reported IVV net assets of about $889.4 billion as of August 20, with the fund up 13.4% year to date through August 19.
IVV itself tracks the S&P 500 and carries a 0.03% expense ratio.
The disparity tells us where most of IVVon’s growth came from.
Because the token tracks an existing ETF, its market capitalization can increase through both appreciation of the underlying security and the creation of additional tokens as investors enter the product. With IVVon expanding far faster than IVV’s underlying performance, most of the increase cannot be explained by the stock market rally alone.
The important signal is therefore net growth in tokenized exposure, not simply a rising S&P 500.
That distinction makes IVVon more useful as a measure of demand for on-chain securities than its price performance would be.
The Biggest Tokenized ETF Is Still Tiny Beside the Fund Underneath It
IVVon’s leadership also needs scale.
The $69.6 million tokenized product references an ETF holding roughly $889 billion in assets. On that basis, the tokenized representation is equivalent to less than 0.01% of IVV’s traditional fund assets.
That gap prevents two misleading conclusions.
First, tokenized ETFs are not replacing conventional ETFs at any meaningful scale. The existing brokerage, exchange and custody system still handles virtually all capital invested in IVV.
Second, the relatively small size is precisely why growth rates can be so high. Adding $20 million or $30 million to a tokenized product can transform its position in the sector while barely registering against the size of the underlying traditional market.
The more useful question is consequently not whether IVVon can compete with IVV. It cannot at present.
The competition is over whether blockchain rails can become an additional distribution channel for assets that already have deep liquidity and established demand in traditional markets.
Why an S&P 500 Product Is Leading Instead of a Crypto ETF
The ranking is particularly interesting because IVVon has overtaken IBITon, Ondo’s tokenized representation of BlackRock’s iShares Bitcoin Trust.
At first glance, a Bitcoin ETF might appear better suited to blockchain distribution than an S&P 500 fund. Crypto-native investors already understand Bitcoin, hold stablecoins and use on-chain trading infrastructure.
Yet IVVon now stands at $69.6 million compared with approximately $47.8 million for IBITon.
That suggests tokenization demand is not limited to placing crypto exposure onto another blockchain token.
An S&P 500 wrapper allows an on-chain portfolio to gain U.S. equity exposure without moving capital back through a conventional brokerage account. A stablecoin holder, for example, can move from digital dollars into a token representing a diversified equity ETF while remaining within blockchain-based infrastructure, subject to Ondo’s eligibility and jurisdictional restrictions.
That is a different use case from tokenized Bitcoin. BTC already exists natively on-chain. Tokenizing a Bitcoin ETF mainly replicates a financial wrapper around an asset that crypto investors can access directly.
Tokenizing IVV brings an asset class that does not natively exist on public blockchains into the same settlement environment.
That may explain why broad equity exposure is proving particularly useful within the tokenized securities market.
IVVon, IBITon and SPYx Are Not Interchangeable Products
A leaderboard based only on market capitalization also hides structural differences between the products being compared.
IVVon and IBITon belong to Ondo’s tokenized securities ecosystem. Ondo says its products are backed by the corresponding stocks or ETFs together with cash in transit, with underlying holdings maintained through U.S.-regulated broker-dealers or national trust companies. Eligible users can mint and redeem Ondo Stocks against their underlying economic value, with availability subject to jurisdictional restrictions.
SPYx comes from Backed’s xStocks platform and references the SPDR S&P 500 ETF rather than BlackRock’s IVV. Backed describes SPYx as a tracker certificate issued as blockchain tokens, with underlying assets held through designated brokers and custodians. Its published product terms include issuance and redemption fees of up to 0.50%.
The three products therefore compete for similar pools of capital without necessarily giving holders identical legal rights, distribution channels or redemption mechanics.
A useful comparison is:
| Token | Reference Asset | Market Cap | Provider |
|---|---|---|---|
| IVVon | iShares Core S&P 500 ETF | $69.6M | Ondo |
| IBITon | iShares Bitcoin Trust | $47.8M | Ondo |
| SPYx | SPDR S&P 500 ETF Trust | $47.6M | Backed |
The market-cap figures reflect the latest Token Terminal data. Product structures come from Ondo and Backed disclosures.
For investors, comparing tokenized ETFs therefore requires more than finding the token with the largest supply. Backing arrangements, redemption rights, fees, investor eligibility, blockchain availability and counterparty structure can differ even when two products ultimately provide exposure to the same S&P 500 index.
Ondo’s Advantage May Be Distribution Rather Than the Token Itself
IVVon’s acceleration is easier to understand when viewed alongside the expansion of Ondo Stocks.
The platform now offers more than 440 tokenized stocks and ETFs across Ethereum, BNB Chain and Solana, according to Ondo.
Eligible investors can obtain tokenized exposure to U.S. securities while the underlying assets remain connected to traditional market liquidity.
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Distribution has widened beyond Ondo’s own interface.
In March, the company integrated tokenized securities including IVVon, SPYon and QQQon with Bitget, placing the products alongside crypto assets on a centralized exchange. Ondo also reported in March that its tokenized securities platform had surpassed $700 million in total value locked and $12 billion in cumulative volume since launching in September 2025.
Those numbers matter because tokenization by itself does not solve distribution.
Creating a blockchain token representing an ETF is technically possible. Building enough routes through wallets, exchanges, stablecoins and decentralized applications for investors to actually use it is harder.
The current market-cap ranking may therefore be measuring ecosystem reach as much as demand for the individual ETFs.
DeFi Gives Tokenized ETFs a Use That Brokerage Shares Do Not Have
The strongest argument for putting an ETF on-chain emerges after the token has been purchased.
A conventional ETF share can already be traded cheaply and efficiently through a brokerage account. For highly liquid funds such as IVV, tokenization does not solve an obvious problem with the underlying market itself. IVV had a 30-day median bid-ask spread of just 0.01% as of August 19.
The added functionality appears elsewhere.
Blockchain-based securities can move between compatible wallets and applications and, where integrations permit, become collateral inside decentralized financial markets.
Ondo began taking that step in February by integrating SPYon and QQQon into Morpho lending markets with risk parameters managed by Gauntlet. The tokens can be supplied as collateral for borrowing rather than merely held for market exposure.
That is materially different from buying an ETF through a brokerage account.
An investor holding a tokenized equity can potentially combine traditional market exposure with stablecoin borrowing or other on-chain strategies without first selling the security and moving cash between financial systems.
Those additional uses create a reason for tokenized ETFs to exist even when the conventional ETF itself is already highly efficient.
The U.S. Version of IVVon Changes the Legal Model Again
Ondo’s expansion in July introduced another distinction that could become more important than the market-cap ranking.
The company launched a U.S. custodial tokenization model covering IVV and Micron shares in partnership with Broadridge. Under that structure, the original securities remain inside the regulated U.S. custody chain while a registered transfer agent issues corresponding tokens on Ethereum. Broadridge provides proxy voting and shareholder communications to token holders.
That structure differs from many offshore tokenized-security products whose tokens provide economic exposure but are distributed under separate legal frameworks.
The timing follows the SEC’s January 2026 description of third-party custodial tokenization, where an intermediary holds conventional securities and issues crypto assets representing holders’ entitlement to them. Ondo says its U.S. launch follows that model.
This creates an unusual situation in which the same broad tokenization theme is developing through different legal routes depending on the investor and jurisdiction.
Market capitalization alone does not capture that distinction, but institutional adoption may eventually depend on it.
The Next Contest Is Whether Tokenized ETFs Become Useful Collateral
IVVon has already demonstrated that a tokenized S&P 500 product can attract substantially more capital than it held at the beginning of the year. The next measurable shift will come from what holders can do with that capital after purchasing it.
Ondo has already introduced DeFi lending for SPYon and QQQon, but IVVon’s larger supply makes it an obvious product to watch for deeper integration across lending, collateral and portfolio-management protocols. Wider use would make the token’s market capitalization less dependent on investors simply choosing blockchain delivery over a brokerage account.
The competitive gap is also still narrow in absolute terms. IVVon leads IBITon by about $21.8 million and SPYx by roughly $22 million, amounts that can change quickly in a market where individual products remain below $100 million.
More revealing than the leaderboard will be whether IVVon’s growth continues to come from newly issued tokens, how much of that supply moves into secondary markets and whether applications begin treating tokenized ETF positions as reusable financial collateral rather than assets that merely sit in on-chain wallets.
The information presented in this article is intended for informational purposes only and should not be interpreted as financial, investment, or trading advice. Coinspress.com does not promote or advocate for any particular investment strategy, asset, or cryptocurrency project. Cryptocurrency markets are highly volatile and unpredictable – always perform your own research and seek guidance from a qualified financial professional before making any investment decisions.
Alexander Stefanov
Reporter at CoinsPress
Alex is Editor-in-Chief of Coinspress and co-founder of Millennial Media Group, with nearly a decade of experience covering financial markets - crypto first, then everything else. It started in 2016 with Bitcoin. Like most people at the time, he didn't fully understand it - so he kept digging. Blockchain, tokenomics, the projects, the cycles. That curiosity never stopped, and eventually pulled him into traditional markets too: equities, commodities, macro. Not because he left crypto behind, but because you can't properly understand one without the other. What drives him is straightforward: he wants to know why something is happening, not just that it's happening. Most market coverage stops at the headline - price up, price down, here's a chart. Alex finds that kind of reporting actively unhelpful. If you walk away from an article without understanding the mechanism behind the move, what did you actually learn? He holds a degree in Tourism from New Bulgarian University - not the most obvious path into financial markets, but markets have a way of pulling in people who are simply too curious to stay out. He has authored over 200 in-depth analyses and more than 10,000 articles across crypto and traditional finance. He still thinks every day in markets teaches him something new. That's probably why he hasn't stopped.
