According to CoinDesk, Ondo Finance is shifting $95 million of backing assets for its OUSG token to BlackRock's BUIDL tokenized fund from a less desirable short-term Treasury bond ETF. Ondo Finance CEO Nathan Allman said that OUSG will become significantly more usable with instant, around-the-clock subscriptions and redemptions. Previously, Ondo's OUSG token was backed by BlackRock's iShares Short Treasury Bond exchange-traded fund (ETF), which traded only during traditional market hours, opposite to crypto's around-the-clock nature.
The allocation allows Ondo to significantly speed up subscription and redemption time to instant settlement at any day from the T+2 days, according to an Ondo blog post. Many investors have been hesitant to use OUSG because of the time it used to take to redeem, and given the 24/7/365 and volatile nature of crypto markets and the often sudden need for capital that arises from that, Allman said in a Telegram interview with CoinDesk. Ondo has already transferred $15 million of OUSG backing assets to BlackRock's BUIDL over the past days and plans to move another $80 million by the end of Wednesday.
Ondo's action marks the first example of a crypto protocol leveraging asset management giant BlackRock's tokenized fund offering, which debuted last week. The fund, represented by the Ethereum-based BUIDL token backed by U.S. Treasury bills and repo agreements, is targeted for white-listed, institutional clients and requires at least a $5 million minimum allocation. While the strict requirements prohibit smaller investors from investing in BlackRock's BUIDL, it allows other platforms such as Ondo to leverage the fund for its own retail-facing offerings.
