Ondo launches Private Markets: what a pre-IPO note means for your payout and your tax bill

Ondo Finance launched a platform on October 6, 2026 that makes stakes in companies tradable before they reach the stock market. What trades are tokenised notes, not shares; their value is tied to the price of one common share in the company concerned. Payment comes only once that company has completed a listing, is taken over, or ten years have passed. For anyone holding ONDO or considering a purchase, a new line of business is thereby written into the project, and at the same time a product that meets different rules in Germany than a coin does.

One thing at a time, because three questions hang on this launch that the press release does not answer: what do you legally buy? Who may buy at all? And when does money come back?

What Ondo Private Markets sells: tokenised notes instead of shares

A note is a debt instrument: a paper by which an issuer promises the buyer a payment. At Ondo Private Markets the size of that payment follows the value of one common share in the company the note refers to. Ondo calls that company the reference company.

Ondo's product page states the difference from a share itself, and plainly: the tokens are “not themselves stocks” and give their holders no rights to hold or receive the underlying assets. Buying such a note therefore does not make you a shareholder. There is no voting right, no annual general meeting, no dividend and no claim to delivery of the share itself. What remains is economic participation in the price, mediated through the issuer's promise to pay.

This design is nothing new in finance. Certificates and warrants have worked on the same basic idea for decades, and their best-known risk carries the same name as here: issuer risk. If the issuer fails, it does not help the holder that the reference company is flourishing.

Which documents govern

Ondo names three documents that govern the relationship: the token terms, the subscription agreement and a declaration accepting the token terms together with the repayment claim. In case of doubt, the token terms prevail. For a buyer that means the marketing page is not the contract. What applies is in the terms, which are only available during the subscription process.

The issuer sits in the British Virgin Islands: PM Issuer Co (BVI) Limited

As issuer of the notes Ondo names PM Issuer Co (BVI) Limited, a company under the law of the British Virgin Islands. For tokenised products this is a widespread construction, and it has two tangible consequences for German buyers.

First, the counterparty's seat lies outside the European Union. A dispute over the terms will therefore not automatically be heard before a German court, and the deposit guarantee or investor compensation familiar from a German institution does not apply here. Second, according to Ondo the tokens are not registered under the US Securities Act of 1933. That lack of registration is the reason for the access restriction set out below.

The press release puts a figure in front of the product to explain its market: roughly 87 percent of US companies with annual revenue above $100 million are said to be in private hands. The figure comes from Ondo's own announcement and describes why pre-IPO stakes are attractive as a product. It says nothing about how well this particular product does its job.

Qualifying liquidity event: when the note actually pays out

The product's most important mechanism is its payout date. Ondo pays neither at the end of a term nor on the holder's demand, but upon a qualifying liquidity event. The product page names four triggers: a listing that has traded for six months; a majority takeover; an insolvency; and the expiry of ten years after issuance.

More hangs on that list than it shows at first glance. A funding round expressly does not trigger payment, nor does a takeover offer to individual existing shareholders, nor does a sale of stakes on the secondary market. Yet those are precisely the events at which private companies are most often revalued. A holder can therefore watch their reference company valued at a multiple without any payment falling due.

What is then paid out is the liquidity event price of one common share, less tax withholding and settlement fees. Ondo names no amounts for these. Whether an event has occurred and which price applies is decided by a calculation agent at its reasonable discretion. For an investor that is a valuation they cannot recalculate themselves.

Secondary trading on the Ondo Perps Spot Market: 24/7 without a reference price

Because the payout can be years away, the secondary market becomes the actual way out. Ondo sets it up on its own Ondo Perps Spot Market, open around the clock. Further venues may follow later. The tokens are freely transferable, can be self-custodied and used in DeFi applications, though only to other eligible holders.

Ondo itself notes three restrictions. Trading is subject to maintenance, risk controls and suspension by the issuer. Liquidity may be limited and the spread between bid and ask wide. And there is no public market price for the reference company and no generally accepted comparable value, which is why the secondary market price can deviate considerably from the last private valuation and from the later payout.

That sets the instrument apart from everything traded on an established perp DEX. With Bitcoin or Ether there is a worldwide reference price across dozens of venues. Here buyers and sellers set the price among themselves, on a market the issuer is allowed to halt.

Access for eligible investors only: what the US exclusion means for Germany

The product page carries a “Not Available in US” banner, and it puts the exclusion harshly: US persons are prohibited from subscribing for, acquiring or redeeming the tokens. Behind that stands the missing registration under US securities law. For all other countries Ondo opens the product only to eligible investors, without saying on the page who falls under that.

For German prospects that gap is the practical crux. Access to the primary sale runs, according to Ondo, through selected distribution partners and through Ondo Private Client, meaning a service that is usually tied to minimum amounts and to evidence of investor suitability. Whether a retail investor from Germany passes that test is decided only during the subscription process, and no publicly available document from Ondo answers it in advance.

Clearing that up takes two steps there is no way around: request the subscription documents and look in them for which countries and which investor status are listed. A look at the marketing page is not enough.

Why an exclusion is no substitute for a recommendation

That a product excludes US investors is neither a mark of quality nor a defect. It follows from how the issuer set up its paper legally. What is sold is the same risk, merely to a different circle.

MiCA does not apply to tokenised notes: the legal framework for German buyers

Since 2024 the EU's MiCA regulation has governed the market for crypto assets, bringing authorisation requirements for trading venues, custodians and issuers. That regulation is not the yardstick here, though. MiCA excludes crypto assets that qualify as financial instruments. A note whose value is tied to a share carries exactly the features of a financial instrument, so the rules for securities apply instead of those for crypto assets. We have set out what that means for companies in practice in our overview of the MiCA obligations to 2026.

For a buyer the question of protection thereby turns around. With a MiCA-regulated provider, they can look up whether an authorisation exists and which supervisor granted it. With a security from an issuer in the British Virgin Islands that is not publicly offered in the EU, there is no approved prospectus in which a European supervisor has checked the statements. The checking shifts entirely to the buyer.

A classification in the individual case can only be made by a lawyer or tax adviser with the specific token terms in hand. This article describes which questions to ask, not which answer is right for a particular instrument.

Tax on pre-IPO notes: capital gains tax instead of the one-year holding period

Here lies the difference that can cost or save German investors the most money. For crypto assets such as Bitcoin the one-year holding period under Section 23 of the German Income Tax Act applies: hold for more than a year and the gain is sold tax-free. That rule covers private disposals of other assets.

A note does not belong in that category. Capital claims fall under Section 20 of the Income Tax Act, and there is no holding period there after which the gain becomes tax-free. Gains are subject to withholding tax of 25 percent plus the solidarity surcharge and, where applicable, church tax, regardless of whether two months or seven years lie between purchase and sale. How the tax office classifies a specific tokenised instrument depends on the issuance terms; a foreign issuer also does not remit the tax automatically, so the declaration stays with the investor. Anyone holding several such positions over the year needs a schedule recording purchase, sale and deductions for each instrument.

The fact that, according to the product page, the issuer withholds tax before the payout changes none of this. A deduction at source abroad and the German tax liability are two separate matters, which in the best case can be set off against each other through a double taxation agreement.

ONDO price this week: $0.4822 and Thursday's weekly low

The token itself barely reacted to the launch, because the broader market set the tone for the week. ONDO trades at $0.4822, putting it 1.2 percent below the level of seven days ago, according to CoinGecko as of Thursday, 11:55 pm. The weekly high was $0.5106 on October 2, the weekly low $0.4437 on Thursday afternoon, the day of this article. By market capitalisation ONDO stands in 48th place.

The slide to the weekly low coincided with a broad sell-off in which Bitcoin dropped below $81,000 and several altcoins lost double digits. The reasons for that lie outside Ondo, with rising bond yields and outflows from the Bitcoin ETFs.

As an observation, not a price target: above, the weekly high at $0.5106 marks the first hurdle, along with the round $0.50 level. Below lies the weekly low at $0.4437, and beneath it the round $0.44 level. Whether a new line of business carries the token is decided over months, and by whether the notes generate revenue.

From Ondo Stocks to Private Markets: what Ondo has tokenised so far

Private Markets is the provider's third pillar. First came tokenised US Treasuries, then tokenised listed shares and funds. That equities business was called Ondo Global Markets until July 2026 and has run as Ondo Stocks since; in June 2026 the catalogue grew by 173 instruments to more than 430 positions across three blockchains. September brought the Intelligent Portfolios, three tokenised model portfolios following BlackRock model strategies. This offering is being rolled out step by step to further blockchains, most recently to NEAR.

Across these platforms together, Ondo reports by its own account a deposited value of $3.7 billion to $3.9 billion, with sources diverging on the figure, and more than one million holders over time. These numbers belong to the existing business, not to Private Markets, which began on October 6 with a single reference company from the AI sector.

Further sectors have been announced: biotechnology, robotics, defence, energy, space, quantum technology, aviation, logistics, digital assets and cybersecurity. A timetable for them is missing, and Ondo has not named the first reference company either. According to the announcement, secondary trading was due to start in the week after the launch.

How to recognise a legitimate route in

Tokenised pre-IPO stakes are a field in which dubious providers also advertise, because the values are inherently hard to verify. Three features separate a genuine offer from a scam: there is a named issuer with a legal form and a seat. There are subscription documents describing repayment, fees and risks. And there is a clear statement of which circle of investors is admitted. Ondo meets these three points on its product page. Anyone who instead finds only a yield promise and a payment window leaves the product alone and stays with a regulated provider.

Ondo Private Markets: no money flows until the liquidity event

The product extends what can be traded over a blockchain, and in doing so it shifts risks that do not arise with a share: onto the issuer, onto the valuation by a calculation agent and onto a secondary market without a reference price. Checking it for yourself goes in this order.

1. Clarify access before you calculate. Request the subscription documents and look up whether investors resident in Germany are listed and which status is required. If you do not fall under it, everything else resolves itself. An overview of providers that accept German retail investors in the ordinary course is with the regulated crypto exchanges.
2. Read up on repayment and costs. Look in the token terms for the list of liquidity events, for the role of the calculation agent and for the deductions applied before the payout. The ten-year period is the ceiling on your commitment. Whether you want to spread your portfolio more widely alongside it is settled by the comparison of crypto brokers.
3. Get the tax classification in advance. Put the terms to a tax adviser and have them tell you whether the instrument falls under Section 20 of the Income Tax Act. A year of holding makes no gain tax-free here. For recording the positions over the year, the tax tools and portfolio trackers help.

The statements in this article come from the Ondo Private Markets product page and from the report on the launch of October 6, 2026.

(As of October 8, 2026. This article is not investment advice. Prices and fee structures change; check the terms with the provider before you buy.)