What is Ondo Finance (ONDO)?
- Author
- CRYPTO PORT Editorial
- Published
- Updated
- Reading time
- 6 min
In short
Ondo Finance tokenises real-world financial instruments, notably US Treasuries, so they can be held and moved on-chain. Founded in 2021, it offers products such as tokenised Treasury funds. Because these fall under securities regulation, who may buy them is restricted by jurisdiction and investor status.
Key points
- Operates in the tokenisation of real-world assets (RWA)
- Offers tokenised products backed by US Treasuries
- Access is restricted by residency and investor classification
- ONDO is a governance token, distinct from the products themselves
Definition
A real-world asset tokenisation project that issues tokens backed by instruments such as US Treasuries for holding and transfer on-chain.
Ondo addresses the fact that almost everything on-chain is either crypto or pegged to it. Stablecoins hold their value but pay nothing to hold. Traditional markets, meanwhile, have instruments like government bonds that generate interest. Connecting the two — making such instruments holdable as tokens — is the field known as real-world asset tokenisation.
Mechanically, a fund or trust formed under the relevant regulations holds the actual securities, and tokens representing an interest in it are issued on-chain. Because transferring the token transfers the interest, round-the-clock settlement and use as collateral in DeFi become technically possible. Custody, administration and audit of the underlying assets, however, remain with conventional financial institutions, outside the blockchain.
The crucial constraint is that these products are securities. Not everyone can buy them: eligibility depends on residency and investor classification, identity verification is mandatory, and transfers are typically limited to approved addresses. That is a very different premise from the permissionless assets most people associate with crypto.
ONDO is a governance token, not an interest in any product. It is used to decide protocol matters, and holding it does not entitle anyone to the interest generated by the underlying Treasuries — a distinction worth keeping clear.
Watch out for
- · Tokenised products are securities and may be unavailable depending on your residency and investor status
- · Custody and audit of the underlying assets rest with outside institutions, whose credit risk you take on
- · ONDO is a governance token, not a right to the income from the underlying assets
Frequently asked questions
Can I buy these products from Japan?
Availability is limited by jurisdiction and investor classification, and may exclude you. Always check the issuer's official terms for current eligibility.