Ondo taps LayerZero to take USDY multichain
Ondo Finance, a tokenized real-world asset (RWA) protocol, has tapped LayerZero to deploy a flagship product-bearing stablecoin across multiple blockchain networks, LayerZero told Cointelegraph on November 26.
Users can now search for Ondo's US Dollar Yield Token (USDY) and access the token. [United States] Treasurys are produced across multiple blockchain ecosystems without the need to issue new tokens or exchange assets between chains,” said Ondo.
According to Ondo, LayerZero's Omnichain Fungible Token (OFT) integrates the standard and positions USDY as a “compelling alternative to traditional stablecoins such as USD Coin (USDC) and Tether (USDT).”
The USDY stablecoin “has now completely mushroomed over Ethereum, Mantle and Arbitrum,” Ondo told Cointelegraph. It plans to add more networks soon.
Source: RWA.xyz
Ondo USDY is a product token designed to allow users to earn 4.9% Annual Percentage Return (APR). Each USDY token is backed by bank deposits and short-term treasury bills, Ondo said.
USDY has a total locked-in (TVL) of more than $450 million and is available on eight blockchain networks, including Ethereum and Solana, according to Defillama.
In addition, Ondo offers another tokenized treasury product, Ondo Short-Term U.S. Government Treasuries (OUSD).
The LayerZero OST standard “works by burning a token on the source chain every time an omnichain transfer is initiated…creating a uniform supply across both networks,” according to the LayerZero website.
This “allows tokens to be transferred across multiple blockchains without asset wraps, intermediary chains or liquidity pools,” the company said.
Source: Defillama
According to data from RWA.xyz, the total market capitalization of tokenized treasury products will more than triple by 2024. In the year As of Nov. 26, they collectively command a market capitalization of about $2.5 billion.
Ondo is the most popular US Treasury protocol. At $650 million, TVL leads rivals including Ondo Securities, Hashnot and Franklin Templeton, RWA.xyz reported.
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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