• On-chain funds are now available on DeFi platform Ondo Finance to allow stablecoin holders to invest directly in bonds and U.S. Treasurys.
• This regulated product could potentially attract more than $100 billion in stablecoins that currently may not be earning yields for their holders.
• The funds are invested in exchange-traded funds managed by BlackRock and Pimco, with Coinbase Custody and Coinbase Prime handling conversions between stablecoins and fiat.
Decentralized finance (DeFi) platform Ondo Finance has recently launched three products that allow stablecoin holders globally to invest directly in bonds and U.S. Treasurys. This is an exciting development that could potentially open the door to billions of dollars in stablecoins currently not earning yields for their holders.
The three funds available on Ondo’s site are the OUSG fund, which invests in short-term government Treasurys and yields 4.2% per annum; the OSTB fund, which invests in short-term bonds and yields 5.45% per annum; and the OYHG fund, which invests in high-yield corporate bonds and yields 8% per annum. Fees for these funds are currently listed at 0.15%.
The funds deposited on Ondo will further be invested in relevant exchange-traded funds offered by BlackRock and Pimco. Coinbase Custody will custody any stablecoins the fund holds, while Coinbase Prime will handle conversions between stablecoins and fiat.
The new Ondo Finance products could be a game-changer for the stablecoin market, allowing holders to earn yields on their coins, thus incentivizing their adoption. Furthermore, the funds are managed by two of the largest and most trusted institutions in the world, BlackRock and Pimco, giving holders even more assurance and peace of mind.
Ondo Finance is an innovative DeFi platform that is bridging the gap between traditional and decentralized finance. With its new tokenized corporate bonds, stablecoin holders can now earn yields on their coins while remaining in the crypto ecosystem. This can be a major step forward in the mainstream adoption of cryptocurrencies.