NEW YORK, April 27, 2022 /PRNewswire/ — Ondo Finance has raised a $20 million Series A to accelerate adoption of DeFi among traditional investors. This latest round of funding was led by Founders Fund, the venture capital firm founded by Pierre Thiel, and Pantera Capital. The funding will allow Ondo to strengthen its team and support new product launches, including its multi-channel expansion. Strategic investors joining the round also included Coinbase Ventures, GoldenTree, Wintermute, Steel Perlot (Michelle Ritter / Eric Schmidt), Tiger Global and Flow Traders.
Ondo Finance is building a decentralized investment bank focused on connecting stakeholders in the emerging DeFi ecosystem, including Decentralized Autonomous Organizations (DAOs), institutions, and retail investors. As its first offering, the company has built a new primitive for decentralized structured products that offer the choice between downside protection and enhanced returns.
The company quickly expanded into other use cases, such as its Liquidity-as-a-Service (LaaS) offering, which pairs DAOs with subscribers to provide liquidity for a DAO’s native token, so that its users can easily trade its token in decentralized exchanges. . Ondo has partnered with more than ten DAOs, including Terra, Frax, and Fei, and seen more than $200 million in cash deposited in its protocol. With its rapid organic community growth and product adoption, Ondo is ready to begin decentralizing governance with the upcoming launch of the ONDO token and associated DAO.
“We were thrilled to see the demand for Ondo’s community chests and Liquidity-as-a-Service offerings, which really was a simple MVP with no liquidity mining or other incentives from us,” says Nathan Allmann, Founder and CEO of Ondo Finance. “We are excited about some new product launches that will make it much easier for passive investors to gain broad exposure to DeFi returns at a personalized level of risk.”
Over the next few months, Ondo plans to release several additional products in an effort to increase the breadth, usefulness, and accessibility of its offerings. These include vaults that aggregate returns from algorithmic stablecoins as well as vaults that aggregate returns across different blockchains.
“The growth of algorithmic stablecoins and the expansion of DeFi from Ethereum to other blockchains has led to huge opportunities for returns, but with greater complexity and risk,” says Paul Veradittakit, Partner at Pantera Capital. “Ondo will allow investors to gain passive exposure to this increasingly dispersed but abundant yield while benefiting from downside protection or enhanced yields.”
These new vaults will help the company grow its current ecosystem and user base. To increase demand, Ondo is extending the compatibility of its products with other protocols such as Curve and Convex. To expand the capital offering, Ondo is looking to make its offerings more accessible through integrations with crypto exchanges, web2 fintechs, and custodians.
“We are incredibly impressed with the early success of Ondo’s structured products and are excited to see the team expand their offering,” said Napoleon Ta, partner at Founders Fund. “Built by a world-class team at the intersection of crypto and institutional finance, Ondo is well positioned to be a preeminent player in DeFi’s continued ascent to mainstream adoption.”
Ondo Finance is building a decentralized investment bank. Like a traditional investment bank, Ondo aims to be a hub connecting those who have capital with those who need it through the creation of customized financial products (e.g. stocks, bonds, structured products, derivatives, etc.) that organizations can offer to investors to raise money. Historically, this work has often been very manual, costly and dependent on intermediaries. Decentralized finance (DeFi), however, presents new infrastructure and financial primitives to enable automated, composable, and universally accessible investment banking activities. Ondo’s goal is to create software that finds attractive investments in the traditional and DeFi landscape, repackages those assets into easy-to-understand risk/reward offerings, and then matches and offers those assets to institutional and retail investors.