Ondo Finance to Launch Tokenized US Treasury Fund on XRP Ledger

Ondo Finance has announced plans to launch its tokenized US Treasury fund, Ondo Short-Term US Government Treasuries (OUSG), on the XRP Ledger (XRPL) within the next six months.

This development marks OUSG as a significant financial tool on the decentralized XRPL.

Ondo Finance Chooses XRP Ledger for OUSG Launch

The deployment of OUSG on the XRPL represents a major leap in advancing institutional-grade financial solutions. It marks the collaboration of Ripple and Ondo Finance to seed liquidity for OUSG at launch. The move would encourage the early adoption of tokenized real-world assets (RWAs) on the XRPL.

Ondo Finance’s tokenized treasury fund will leverage XRPL’s infrastructure to bridge the gap between decentralized finance (DeFi) and traditional finance (TradFi). XRPL’s focus on TradFi and established institutional relationships create a solid foundation for OUSG. In return, OUSG will introduce institutional investors to a high-quality, yield-bearing US Treasury fund on XRPL.

“This integration establishes an avenue for institutional DeFi and advanced cash management solutions, bringing DeFi and traditional finance closer than ever,” an excerpt in the announcement read.

According to the announcement, the product is backed by the BlackRock USD Institutional Digital Liquidity Fund (BUIDL). It adheres to stringent KYC/AML standards and blends security, compliance, and yield.

Additional benefits of the collaboration include seamless integration with Ripple’s RLUSD stablecoin. According to the report, this would enable round-the-clock minting and redemption of OUSG, granting users unparalleled liquidity and financial flexibility.

Meanwhile, with over a decade of expertise, the XRP Ledger has become a leading blockchain for financial institutions. It supports cross-border payments, digital asset custody, and stablecoin issuance.

Its tailored infrastructure, including advanced compliance tools and upcoming features like Multi-Purpose Tokens (MPTs), strengthens its position as a hub for RWA tokenization.

Recent milestones highlight the XRPL’s growing significance in institutional finance. Ripple initiated beta testing for the RLUSD stablecoin on the XRPL and Ethereum, setting a precedent for cross-chain financial solutions.

Similarly, OpenEden launched tokenized Treasury bills on the XRPL, backed by Ripple’s $10 million investment. This venture displayed the ledger’s capability for hosting large-scale tokenized assets.

Further, Ripple’s partnership with Evmos to build an EVM-compatible sidechain enhances the XRPL’s versatility. The move allowed institutions to deploy Ethereum-based smart contracts seamlessly.

Ondo Finance’s Growing Institutional Reach

This deployment marks a new chapter for Ondo Finance, as the network has been at the forefront of integrating RWAs into blockchain ecosystems. Nine months ago, Ondo launched an RWA payment network, further solidifying its role in connecting blockchain technology with TradFi.

It also moved $95 million into BlackRock’s tokenized fund, reflecting its commitment to providing high-quality, on-chain investment options.

The integration of OUSG on the XRPL showcases how blockchain technology is transforming institutional finance. By allowing institutions to manage cash, optimize portfolios, and access high-quality yield products entirely on-chain, XRPL is driving the adoption of tokenized assets.

The deployment of OUSG brings DeFi and TradFi closer together as Ripple and Ondo Finance push innovation forward. With robust infrastructure, institutional-grade security, and a growing ecosystem, the XRPL is establishing itself as a key player in the future of tokenized finance.

ONDO Price Performance. Source: BeInCrypto

Despite the report, the impact on Ondo Finance’s powering token, ONDO, has been rather muted. BeInCrypto data shows ONDO was trading at $1.31 as of this writing, representing a modest 0.76% surge since Tuesday’s session opened.