Tokenized securities market value has exceeded $220 million, Ondo Finance issues stablecoin?

According to data from Dune Analytics, the market value of tokenized securities, including bonds and investment bond ETFs, has exceeded $220 million, with significant growth seen this year. Key players include Ondo, Matrixdock, Backed, OpenEden, and Franklin Templeton. Ondo alone has a market value of $139 million, and over 96% of tokenized assets are issued on the Ethereum blockchain.

Ondo Finance Actively Promotes Tokenized Products

The decentralized investment platform Ondo Finance announced in January the launch of tokenized public debt products, allowing stablecoin holders to invest in U.S. Treasury bonds and investment-grade corporate bonds through its tokenized funds. According to information on the Ondo website, the OMMF invested in the U.S. money market has an annual return of 4.5%, the OUSG invested in U.S. Treasury bonds has a return of 4.65%, and the high-yield bond with a credit rating of BB- OHYG has a high return of 8.4%, while the Compound protocol currently only has an annualized return of 1.7%.

OUSG Invests in iShares Short-Term Treasury ETF

Ondo Finance primarily provides a low-risk investment channel for investors with a large amount of stablecoins. Its partner is the U.S. compliant exchange Coinbase, which is also a partner of the stablecoin USDC. Investors verified through KYC on Ondo Finance can invest their USDC in Ondo's products. Taking OUSG as an example, the operational process is as follows:

Investors link their wallet on the Ondo website → invest with a minimum amount of 100,000 USDC → Coinbase converts USDC to USD → remit to Clear Street, its custodian and primary broker → fund managers buy and sell BlackRock iShares ETFs listed on NASDAQ with the code SHV according to instructions → send back to investors' wallet address in the form of tokenized OUSG.

The management fees for OUSG and ETF are each 0.15%.

Ondo Finance also partners with lending protocol Flux, which allows OUSG to be placed back into the protocol for lending. However, based on website data, there seems to be no liquidity at the moment.

OMMF Claims to be the Next Generation Stablecoin

The April-launched OMMF invests in U.S. money market funds and can be purchased and redeemed at any time for 1 USD. Unlike traditional money market funds, OMMF operates 24/7 globally on the Ethereum public blockchain and is compatible with on-chain financial infrastructure such as decentralized lending protocols. To maintain its stable price, OMMF distributes to investors daily in the form of new OMMF tokens.

The U.S. money market fund manages assets of over $5 trillion, especially in the current era of inverted short-term interest rates, the low risk and high liquidity of money market funds are highly attractive assets to investors.

Ondo's Chief Operating Officer, Justin Schmidt, stated:

This is a revolutionary stablecoin of a new generation. Early digital cash was created in an era of zero interest rates. Ondo provides stablecoin price stability and on-chain utility through money market funds, offering exceptional investor protection and passing on returns to holders, creating what we believe is a superior value storage, settlement, and collateral form of chain economics.

Do you remember the news in February that the SEC was investigating Paxos, the issuer of the third-largest stablecoin BUSD, possibly involving unregistered securities? For similarities between stablecoins and money market funds, see why stablecoins are considered securities? BUSD, USDC, USDT may be MMMF.