Ondo Finance Transfers $95M to BlackRock’s Tokenized Fund for Instant Settlements

Ondo Finance, a tokenized real-world asset (RWA) platform, has announced a significant shift in its backing assets for its OUSG token. The company is moving $95 million of assets to BlackRock’s newly launched tokenized fund, BUIDL, in order to enable instant settlements for its U.S. Treasury-backed token.

Previously, Ondo’s OUSG token was backed by BlackRock’s iShares Short Treasury Bond exchange-traded fund (ETF), which only traded during traditional market hours. This posed a challenge for investors in the crypto space, where trading occurs around the clock. By moving to BlackRock’s BUIDL tokenized fund, Ondo aims to speed up subscription and redemption times to instant settlement, allowing for greater usability of the OUSG token.

Nathan Allman, CEO of Ondo Finance, highlighted the importance of this move in a recent interview, stating that many investors were hesitant to use OUSG due to the time it took to redeem. With the shift to BlackRock’s BUIDL fund, OUSG will become a more attractive store-of-value and collateral asset within the crypto ecosystem.

Ondo has already transferred $15 million of OUSG backing assets to BlackRock’s BUIDL and plans to move another $80 million by the end of the day. This action marks the first instance of a crypto protocol leveraging BlackRock’s tokenized fund offering, which debuted recently. The BUIDL fund, represented by the Ethereum-based BUIDL token, is backed by U.S. Treasury bills and repo agreements and is targeted towards institutional clients with a minimum allocation requirement of $5 million.

While the strict requirements of the BUIDL fund may limit access for smaller investors, platforms like Ondo are able to leverage the fund for their retail-facing offerings. This move signifies a growing trend of collaboration between traditional asset management giants and the crypto industry.

Overall, Ondo Finance’s decision to shift backing assets to BlackRock’s BUIDL fund represents a significant step towards enhancing the usability and accessibility of its tokenized assets within the crypto ecosystem. Investors and industry experts will be closely watching the impact of this move on the market in the coming days.