Tokenized RWAs go on-chain as Ondo Finance launches its institutional L1 blockchain

Ondo Finance has officially launched Ondo Chain, a new layer 1 blockchain designed to facilitate the tokenization of real-world assets (RWAs) and accelerate institutional adoption of these assets in the blockchain space. The announcement, made on February 6, highlights the blockchain’s role as the cornerstone of Ondo Global Markets, providing infrastructure specifically tailored to institutional needs in tokenized securities.

Ondo Chain was developed with the goal of overcoming significant hurdles that have hindered the widespread adoption of tokenized securities in the past. These challenges include cross-chain liquidity fragmentation, high transaction fees, regulatory concerns, and network security risks. By addressing these issues, Ondo aims to create an institutional-grade solution that bridges traditional finance and decentralized finance (DeFi).

What sets Ondo Chain apart from other platforms like Sui and Aptos, which are also targeting the institutional tokenization market, is its unique combination of public and permissioned blockchain features. This hybrid approach allows for the openness and decentralization of public chains, while ensuring compliance and security with permissioned validators and other institutional-grade safeguards.

The chain employs a proof-of-stake consensus mechanism, enhancing the security and efficiency of the network while also promoting environmental sustainability. One of the key features of Ondo Chain is its native omnichain messaging, allowing for smoother cross-chain interactions, a crucial feature for interoperability in a multi-chain ecosystem. Additionally, proof of reserves integration ensures transparency, especially for institutions looking to tokenize tangible assets.

One of the core objectives of Ondo Chain is to support DeFi applications that allow for borrowing, lending, and staking of real-world assets. This could open up entirely new markets and financial products, enabling both traditional and crypto-native investors to participate in a wide range of tokenized real-world asset markets. The Ondo team envisions that these features will provide the infrastructure necessary for the widespread institutional adoption of tokenized assets.

Ondo Finance is committed to creating a cost-effective experience for investors, offering enhanced access to crypto wallets, protocols, and applications. In doing so, the platform aims to bring a seamless connection between DeFi and traditional finance. Ondo Chain’s hybrid model could play a key role in making tokenized RWAs a significant part of the financial landscape moving forward.

The growing market for tokenized real-world assets is evident, with key industry players like BlackRock driving the value of tokenized assets on-chain to over $17 billion. Ondo Finance’s share of this market includes $650 million within the $3.5 billion tokenized U.S. Treasuries market. With the launch of Ondo Chain, the platform is well-positioned to play a significant role in the future of tokenized finance, helping bridge the gap between traditional investment markets and the blockchain ecosystem.