Ondo Finance Expands On-Chain Treasury Reserves
Ondo Finance has purchased $25 million of YLDS, the yield-bearing stablecoin issued by Figure Technology Solutions, as part of a strategy to diversify the assets backing its tokenized U.S. Treasurys fund. This strategic investment signifies an expansion of Ondo's on-chain Treasury reserves beyond traditional asset manager products.
YLDS Joins Existing Reserves in Ondo's Tokenized Fund
YLDS will now join a robust reserves portfolio that already includes tokenized Treasury products from prominent financial institutions such as BlackRock, Fidelity, Franklin Templeton, and WisdomTree. The Ondo Short-Term U.S. Government Bond Fund (OUSG) is designed to offer institutional investors direct on-chain exposure to U.S. Treasurys, featuring the advantage of 24/7 redemptions.
Performance and Structure of the OUSG Fund
The OUSG fund provides an estimated annual return of 3.68% and currently holds approximately $777 million in total value locked. This innovative tokenized fund empowers investors by enabling them to access U.S. government bonds through the utilization of blockchain infrastructure, offering a novel approach to fixed-income investment.
Figure Technology Solutions: Infrastructure and Market Presence
Figure Technology Solutions operates its lending and capital-markets infrastructure on the Provenance blockchain. The company has a significant track record, having originated over $19 billion in loans across various products, including home-equity lines, mortgage products, and crypto-backed credit. Figure successfully completed its initial public offering (IPO) on Nasdaq earlier this year, underscoring its established market presence.
YLDS Stablecoin: Market Capitalization and Institutional Focus
According to data from DefiLlama, Figure's YLDS stablecoin boasts a market capitalization of around $100 million. This yield-bearing token is engineered to provide attractive returns while simultaneously maintaining stablecoin characteristics, making it suitable for institutional use cases and demanding financial applications.
Ondo Finance's Growth and European Expansion
Founded in 2021, Ondo Finance is a U.S.-based platform dedicated to tokenizing traditional financial assets. In October, the company demonstrated its commitment to expanding its reach by adding over 100 tokenized Wall Street stocks and exchange-traded funds on-chain to the BNB Chain. Furthermore, on Wednesday, the platform secured regulatory approval from the Liechtenstein Financial Market Authority, enabling it to offer tokenized stocks in Europe. Following this announcement, Figure's stock price experienced a notable climb of nearly 4% in early Monday trading.
The Growing Momentum of Crypto-Backed Lending
The global landscape of crypto-backed lending is experiencing a resurgence, with an increasing number of lenders actively reviving and expanding their crypto-collateralized loan products. This trend is evidenced by initiatives such as Block Earner's introduction of Bitcoin-backed home loans in Australia in July, which allows borrowers to access cash equivalent to up to half of a property's value. Additionally, on Tuesday, Tether announced its investment in Ledn, a platform that facilitates Bitcoin-backed consumer loans, having originated over $390 million in such loans during the third quarter. Complementing these developments, Coinbase launched Ether-backed loans for U.S. customers on Thursday, enabling them to borrow up to $1 million in USDC against their Ethereum holdings.