Wednesday, February 19, 2025

Ondo Finance Launches Omnichain Solution for Tokenized US Treasuries with LayerZero

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KEY TAKEAWAYS

  • Ondo Finance launches an institutional-grade bridging solution for tokenized real-world assets using LayerZero’s technology, enhancing cross-chain composability for US Treasuries products.
  • The integration allows seamless access to Ondo’s tokenized US Treasuries across Ethereum, Mantle, and Arbitrum, without the need for minting new tokens or swapping assets.
  • Ondo’s focus on institutional-grade security involves a multi-layered approach with Decentralized Verification Networks, ensuring robust and adaptable security for USDY transfers.
  • USDY, a tokenized note secured by US Treasuries, aims to be a flexible and composable asset across decentralized applications, leveraging LayerZero’s omnichain capabilities.

Ondo Finance has introduced an institutional-grade bridging solution for tokenized real-world assets (RWAs), leveraging LayerZero’s technology to enable cross-chain composability for its US Treasuries products. This development, announced here, begins with USDY, Ondo’s flagship yield-bearing RWA asset, which will now be interoperable across Ethereum, Mantle, and Arbitrum through LayerZero’s Omnichain Fungible Token (OFT) Standard.

This integration allows users to access Ondo’s tokenized US Treasuries products seamlessly across multiple blockchain ecosystems without the need to mint new tokens or swap assets between chains. By unlocking interoperability, token holders can leverage the yield-bearing capabilities of US Treasuries while maintaining liquidity across a broad range of decentralized finance (DeFi) platforms.

Initially supported on Ethereum, Mantle, and Arbitrum, Ondo plans to expand to more networks as its tokenized US Treasuries products grow. This expansion offers compelling alternatives to traditional stablecoins like USDC and USDT.

Institutional-Grade Security and Multi-Message Aggregation

A key aspect of this integration is its focus on institutional-grade security. Ondo utilizes a robust setup of three Decentralized Verification Networks (DVNs) to verify and secure USDY transfers: Polyhedra Network, Axelar, and LayerZero Labs. This multi-layered approach minimizes the risk of any single point of failure, offering robust, redundant, and adaptable security.

LayerZero’s technology allows Ondo to tailor its security model by selecting trusted verifiers, ensuring both liveness and censorship resistance for USDY transactions. This setup, referred to as Multi-Message Aggregation (MMA), aggregates attestations from a Proof-of-Stake blockchain (Axelar), a Zero-Knowledge prover (Polyhedra), and the LayerZero Labs DVN.

Ondo also plans to develop its own secure DVN, ensuring perpetual liveness and censorship resistance for the asset. Additionally, Ondo retains the ability to reconfigure its DVN selection at any time.

USDY: A New Standard for Omnichain Assets

USDY is the world’s first tokenized note secured by a portfolio of US Treasuries, designed for bankruptcy-remoteness and accessible to non-US individual and institutional investors. It combines the accessibility of stablecoins with US dollar-denominated yield.

As USDY becomes available across more blockchain economies, it aims to be not only a yield-bearing stablecoin but also a flexible and composable asset across a range of decentralized applications (dApps) and financial platforms. With LayerZero’s omnichain capabilities, USDY is poised to unlock new possibilities as a stablecoin alternative, maximizing the utility of digital assets.

LayerZero has established itself as a leading omnichain protocol, with over 135 million messages transmitted across more than 90 blockchains. By adopting LayerZero’s Omnichain Fungible Token Standard, Ondo addresses the problem of liquidity fragmentation for USDY, allowing it to operate across multiple chains without wrapping or token exchanges. This capability ensures that USDY can compete in terms of accessibility with market leaders like USDC and USDT.


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Shree Narayan Jha
Shree Narayan Jha
Shree Narayan Jha is a tech professional with extensive experience in blockchain technology. As a writer for CoinsHolder.com, Shree simplifies complex blockchain concepts, providing readers with clear and insightful content on the latest trends and developments in the industry.

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