Ondo Finance: A Cosmos-Powered Leap Forward

With a current TVL of $1.39 billion, Ondo Finance has established itself as a leader in tokenizing real-world assets, building institutional-grade platforms and infrastructure to bring financial markets and services onchain, including:

• Tokenized U.S. Treasuries.
• Borrowing and lending platform.
• Bridging Infrastructure
• Soon, tokenized stocks and ETFs

Traditional fixed-income products like U.S. Treasuries and money market funds can be hard to access for non-US individuals and institutions, slow and costly to buy or settle, or illiquid outside centralized brokerages.

Ondo aims to address these issues with its RWA infrastructure, including the upcoming Ondo Chain, built on the Cosmos SDK and designed with Cosmos EVM compatibility.

By combining the openness of public blockchains with the compliance and security features of permissioned chains, Ondo Chain — a proof-of-stake blockchain designed for institutional-grade RWAs — provides infrastructure to use tokenized assets at scale. It enables use cases such as:

• Onchain wealth management with global 24/7/365 access.
• Staking and collateralization of tokenized RWAs.
• Prime brokerage, including margin on RWAs and crypto with best-execution from broker-dealers.
• Enhanced investor protections via permissioned validators and monitoring to prevent front-running.
• Low-latency minting coordinated with off-chain confirmations.

Cosmos EVM Unleashes Developer & Liquidity Channels

Ondo uses Cosmos EVM to support EVM compatibility, including for interoperability between its chain and EVM domains. Ondo-built assets, such as USDY and OUSG, can be native to both Cosmos-based chains and EVM chains. This widens dApp integration potential and increases yield and liquidity opportunities.

Aligning with EVM standards allows Ondo to tap into Ethereum’s robust developer ecosystem and best-in-class developer tooling. Its chain rollout features modules that support native bridges across both EVM and non-EVM chains, including Ethereum, Mantle, Arbitrum, Solana, Aptos, Sui, and Cosmos. Being EVM-ready streamlines this cross-chain usability.

Why This Matters for Users & Institutions

Developers: Gain access to Cosmos’s scalability models and IBC-connected chains, all while using familiar EVM-smart contract standards, so there’s no need to choose between ecosystems.

Asset Issuers: Can tokenize assets, and deploy yield-bearing instruments across Cosmos and Ethereum with minimal friction.

Investors: Enjoy near-24/7 access to RWA yields, competitive gas fees paid in tokenized RWAs, and the assurance of institutional-grade permissioning and compliance.

Why Did Ondo Use the Cosmos SDK?

Modular Architecture & High Performance

Built on the Cosmos SDK and leveraging CometBFT consensus, Ondo Chain delivers:

• Fast finality.
• High throughput.
• And reliable performance.

All of which are critical for its key use-cases such as tokenizing U.S. Treasuries, stocks, and ETFs. Both institutions and retail users require certainty that, once they move money or tokens, the change is permanent and secure.

The tokenized RWA market is poised to increase in volume, especially if it continues to attract traditional capital markets. But legacy blockchains can bottleneck with congestion, struggling to support thousands of transactions per second. The fast finality of CometBFT helps ensure strong performance for these traditional finance use cases.

The Cosmos SDK enables Ondo to implement permissioned validator sets, RWA-backed staking, and gas payments in tokenized assets rather than volatile tokens. This aligns with institutional risk standards, mitigates front-running, and ensures compliance safeguards.

The Future is Bright, The Future is Onchain

Ondo Finance’s innovation is progressing by leaps and bounds. Combining the modular, scalable foundation of Cosmos with EVM’s developer-friendly environment, allows Ondo to provide a pathway toward truly omnichain, compliant, yield-driven financial products.

Why Would Developers Want to Build on Ondo Chain?

Beyond access to Ondo’s tokenized assets, Ondo Chain provides DeFi developers with seamless integration to traditional financial systems, built-in compliance tooling, and natively integrated cross-chain bridging, all as part of a familiar, EVM-compatible architecture. For developers wishing to build omnichain apps that utilize RWAs, Ondo Chain will be the natural choice.

And thanks to the dual foundations of Cosmos SDK and EVM compatibility, Ondo Chain is positioned as a robust yet flexible unifier between TradFi assets and DeFi opportunities. This is the blueprint for the future of institutional tokenization.

Ready to build?

Ready to get started building with the Cosmos Stack? Get in touch with our team to discuss your specific use case or check out the product documentation.

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Ondo Finance: A Cosmos-Powered Leap Forward was originally published in Cosmos Ecosystem Blog on Medium, where people are continuing the conversation by highlighting and responding to this story.