Ondo Finance has been everywhere in the news recently with its bold move to add $95 million of its OUSG token to the world’s largest asset management company Blackrock’s BUILD tokenized fund.
So, what is Ondo Finance? What does it do? How is it relevant? Keep reading and find the answers to your questions.
What is Ondo Finance?
Ondo Finance is a Tokenized Real-World Asset (RWA) platform created to make Decentralized Finance yields accessible to a broad range of users.
The audience range includes people with customized risk tolerances, those who are hesitant to make risky investments, to those who purposely choose the riskier ones.
The platform was founded in 2021 by Nathan Allman and Pinku Surana and is headquartered in New York City. Nathan Allman currently serves as the CEO of the company.
The financial software company offers choices between downside protection as well as enhanced returns, for people of varying risk appetites to choose from.
It works by providing a comprehensive suite of Decentralized Finance services including real-world asset tokenization and risk isolation, while ensuring security and decentralization, and prioritizing user empowerment.
The platform also involves smart contracts in trustless transactions and automizing processes and protects users’ funds through risk management strategies.
Ondo finance: features
The DeFi platform, built on blockchain technology, offers a range of services, including borrowing, lending, yield farming, and asset swapping.
The platform aims to democratize access to financial services through a permissionless protocol and without any intermediaries like banks.
Here are some of the features that make the platform stand out and relevant in the real world.
Real World Asset Tokenization
RWA Tokenization represents real-world entities such as art, commodities, real estate, and other physical assets, as digital tokens on the chain.
It also allows the investors to purchase fractional shares in such assets, as a way of enabling investments with smaller capital.
It is an opportunity to diversify portfolios, improve access, and gain liquidity on illiquid assets, that bridges the gap between digital and traditional assets.
Risk isolation
Risk isolation is the process of using advanced risk management techniques such as diversification of assets, collateralization, and insurance, to protect the user’s assets and investments from various risks.
Each of the investment options of Ondo, like lending, borrowing, asset swapping, and yield farming carries different levels of risk and potential returns.
The users can set their risk parameters to control their risk exposure and can use tools like stop-loss orders and limit orders to avoid potential losses.
First subscription vaults
This refers to the four vaults Ondo initiated its services. They focus on top stablecoins like USDC, USDT, and DAI against ETH, and ETH against ALCX, showcasing the platform’s versatility. To subscribe to these vaults, users need to deposit funds into designated smart contracts.
Also, those are managed by professional fund managers and algorithmic strategies to ensure maximum returns.
Community-centric
Apart from offering great educational resources, Ondo lets members voice their suggestions and opinions by making them a part of governance.
They can vote on changes and upgrades, propose structural changes and features, and send feedback, along with participating in community events like hackathons and meetups, the platform organizes.
Such activities are meant to ensure the growth of the platform in alignment with the collective interests of users.
ONDO: Ondo Finance Native Token
Ondo Finance launched a token native to its platform, called ONDO, on 18 January 2024. Initially, the coin was valued at $0.10, which currently stands at $0.89. The coin has a total supply of 10 billion, out of 1.4 billion in circulation in the market as of now.
The market cap of the coin is valued at $1.2 billion and is ranked 96 among cryptocurrencies. You can purchase the coin from the Coinbase crypto exchange but is not yet listed on certain crypto exchanges like Binance.
The Bottom Line
With its one-of-a-kind approach to Decentralized Finance and community-inclusive governance, Ondo Finance is pioneering an innovative movement in the world of cryptocurrency and blockchain networks.
With the right priorities and approach, the platform can act as a significant force that shapes the future of the financial landscape along with empowering its members.
