In a recent development, Ondo Finance’s token, ONDO, has been on a steady rise following the submission of a proposal to integrate the OUSG stablecoin with Sky, previously known as MakerDAO. This move has significantly boosted the price of ONDO, with the token experiencing a two-day consecutive increase, reaching a high of $0.7500, its highest level since August 25th.
The collaboration between Ondo Finance’s developers, Blackrock, and Securitize has paved the way for the OUSG proposal to be included in the Spark Tokenization Grand Prix. This initiative aims to onboard $1 billion in tokenized assets, further solidifying Ondo Finance’s position in the market.
OUSG, a tokenized product by Ondo Finance, currently holds over $227 million in assets and offers holders monthly rewards. With an annual APY of 5.11%, the token generates its returns from U.S. government treasuries through the Blackrock USD Institutional Digital Liquidity Fund. While OUSG is primarily available to institutional investors, it charges a modest 0.15% fee.
Apart from OUSG, Ondo Finance also operates the USDY token, a popular US dollar yield token that yields 5.35% and boasts over $400 million in assets. Unlike OUSG, USDY is exclusively accessible to institutional investors.
The recent surge in assets under management at Ondo Finance has propelled the total figure to a record high of $616 million. The majority of these assets are held in the Ethereum chain, followed by investments in Solana, Mantle, and Aptos.
A looming concern for Ondo Finance is the potential loss of assets as investors pivot away from government bonds following the Federal Reserve’s decision to cut interest rates. In a significant move last week, the Fed implemented a substantial 0.50% rate cut and hinted at further reductions. Consequently, the benchmark 10-year yield has retreated to 3.7% from this year’s peak of over 4.6%.
Despite the prevailing narrative that lower interest rates could trigger a shift towards riskier assets, Ondo Finance’s CEO, Nathan Allman, rebuffed this notion. In a series of tweets, Allman argued that yield tokens like Ondo stand to benefit from falling rates as investors seek out higher returns, even in riskier assets such as cryptocurrencies. He pointed to the USDC stablecoin, which experienced a surge in assets when the Fed initiated rate cuts in 2020.
As Ondo Finance’s token, ONDO, continues to gain momentum, it has recently surpassed the 50-day moving average and the 61.8% Fibonacci retracement point. Both the Relative Strength Index and the moving average convergence/divergence indicators have been climbing, signaling a positive trend for the token.
Moreover, the volume in the spot market has been increasing, while futures open interest has reached $107 million, its highest level since August 25th. These factors indicate that ONDO is poised to sustain its upward trajectory, with the next crucial level to watch being the 50% retracement point at $0.8392.
With the integration of the OUSG stablecoin and the ongoing success of Ondo Finance’s tokenized products, the future looks promising for the platform as it navigates the changing landscape of the financial markets. Investors can expect further developments and innovations from Ondo Finance as it continues to expand its offerings and solidify its position in the industry.
