Ondo Finance introduces layer-1 blockchain to bridge traditional finance and DeFi

Technology

Ondo Finance unveils blockchain for tokenised real-world assets – Crypto News

Published

4 weeks ago

February 12, 2025

Dripp

Ondo Finance, a prominent player in tokenised real-world assets, is taking a significant step toward merging traditional capital markets with decentralised finance (DeFi).

At its inaugural Ondo Summit, the business revealed plans to launch Ondo Chain, a layer-1 blockchain designed particularly for institutional-grade tokenisation.

Ondo Chain, unlike traditional public blockchains, is designed with compliance in mind. It will use permissioned validators to verify transactions and ensure the accuracy of financial data, such as asset prices and token backing. The network will also support tokenised asset staking and native cross-chain bridging, which means improving blockchain interoperability.

“Financial markets are overdue for an upgrade,” said Nathan Allman, CEO of Ondo Finance. “We’re creating an ecosystem that bridges the best of traditional finance with blockchain technology.”

Market reaction and a surprise investment

The statement caused some turbulence in the ONDO token, which dipped 1.5% before rising 3.5% higher. Shortly after, World Liberty Financial—a DeFi protocol backed by Donald Trump and his family—made headlines by investing $470,000 in ONDO tokens, according to blockchain data.

Speaking at the summit, Ian De Bode, Ondo’s chief strategy officer, highlighted the challenges in integrating traditional finance with DeFi. “We set out to build something that combines deep liquidity and investor protections of traditional finance with the open access and innovation of DeFi,” he said. “But we quickly realised the necessary infrastructure didn’t exist to fully bring these two worlds together.”

The announcement comes just a day after Ondo launched a tokenisation platform aimed at placing stocks, bonds, and funds onto blockchain networks.

Tokenisation gains momentum in global finance

Tokenisation—the process of converting real-world assets (RWAs) into blockchain-based digital tokens—is gaining momentum among institutions and policymakers. The shift is being driven by faster settlements, improved efficiency, and broader accessibility for investors. Analysts from McKinsey, BCG, 21Shares, and Bernstein predict that the tokenised RWA market could grow into the trillions of dollars in the coming years.

Industry leaders are taking notice. BlackRock CEO Larry Fink has been transparent about the future of tokenised bonds and stocks, pressing US regulators to establish clear security token rules. Similarly, Robinhood CEO Vlad Tenev views tokenisation as a method to democratise private equity, which is now restricted to accredited investors and the ultra-wealthy.

Ondo Finance is already a key player in the tokenised US Treasuries market, ranking as the second-largest issuer in the space. According to rwa.xyz data, the market cap of its flagship offerings, US Dollar Yield (USDY) and Short-Term US Government Bond (OUSG), are $385 million and $268 million respectively.

With its layer-1 blockchain on the horizon, Ondo Finance believes that real-world asset tokenisation is more than a trend; it is the future of finance.

(Photo by Unsplash)

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Tags: blockchain, crypto, defi