Ondo Finance Plans Yield-Generating Stablecoin Alternative For Institutional Investors

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Security token start-up OndoFinance’s new yield generating stablecoin-like token, OMMF, will be backed by tokenized money market funds for institutional investors. But retail investors can also lend against the token via FluxDeFi. 0x_tracy reports

USDC's Depeg Laid Bare the Risks Traditional Finance Poses to Stablecoins

“Money market funds have a constant $1 NAV [net asset value],” explained Allman. “We’re also targeting holding a few percent of the fund’s assets in stablecoins. That way, investors can get in and out.” Allman declined to give a specific launch date for Ondo’s tokenized money market fund, saying it would go live “soon” and that the company was currently “in the process of onboarding clients.”Security tokens like Ondo’s OMMF have seen a surge in interest as startups and institutional investors alike are exploring ways to migrate traditional financial assets on-chain through tokenization.

“We designed OMMF in a way that makes it composable with on-chain infrastructure,” says Allman. “Because the token is compostable with DeFi, you can lend against it permissionlessly.”, a decentralized finance protocol backed by Ondo that functions as a permissionless touchpoint and, crucially, makes it accessible to retail investors.

“It’s really just DeFi,” added Allman. “This is what all of DeFi enables: the creation of financial services that are not operated by financial institutions.”

 

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