Ondo Finance, a tokenized real-world asset (RWA) protocol, has tapped LayerZero to make its flagship yieldcoin fungible across multiple blockchain networks, LayerZero told Cointelegraph on Nov. 26.
Users can now access Ondo US Dollar Yield Token (USDY) “and its tokenized [United States] Treasurys product across multiple blockchain ecosystems without needing to mint new tokens or swap assets between chains,” Ondo said.
According to Ondo, integrating LayerZero’s Omnichain Fungible Token (OFT) standard establishes USDY as a “compelling alternative to traditional stablecoins like USD Coin (USDC) and Tether (USDT).”
The USDY yieldcoin “is now fully fungible across Ethereum, Mantle, and Arbitrum,” Ondo told Cointelegraph. It plans to add more networks soon.
Source: RWA.xyz
Related: Ondo’s USDY yield coin expands to Arbitrum
Ondo’s USDY is a yield token designed to let users earn some 4.9% annual percentage return (APR). Each USDY token is backed by bank deposits and short-term Treasury bills, according to Ondo.
USDY has a total value locked (TVL) of more than $450 million and is available on eight blockchain networks, including Ethereum and Solana, according to DefiLlama.
Ondo also offers another tokenized treasury product, Ondo Short-Term US Government Treasurys (OUSD).
LayerZero’s OST standard “works by burning tokens on the source chain whenever an omnichain transfer is initiated… creating a unified supply across both networks,” according to LayerZero’s website.
This “allows tokens to be transferred across multiple blockchains without asset wrapping, middlechains, or liquidity pools,” the company said.
Source: DefiLlama
The total market capitalization for tokenized Treasury products has increased by more than three times in 2024, according to data from RWA.xyz. They collectively command a market cap of some $2.5 billion as of Nov. 26.
Ondo is the most popular tokenized US Treasury protocol. With TVL of $650 million, Ondo leads rivals, including Securitize, Hashnote, and Franklin Templeton, according to RWA.xyz.
Collectively, tokenized RWAs represent a $30-trillion market opportunity globally, Colin Butler, Polygon’s global head of institutional capital, told Cointelegraph in an interview.
USDY is not available to US investors and cannot be transferred for 40 days.
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