Ondo Finance, a DeFi protocol, and Pantera Capital, a venture firm, have set their sights on escalating investments in real-world assets (RWAs). This move underscores the growing industry attention towards tokenization, buoyed by a positive regulatory climate in the US.
Both firms disclosed to Axios their intention to channel $250 million into RWAs via a fresh fund named Ondo Catalyst. According to Ian De Bode, Ondo’s Chief Strategy Officer, the fund’s capital will be directed towards acquiring equity and tokens in burgeoning projects.
De Bode mentioned to Axios, “We are witnessing somewhat of a competitive frenzy at present” in the tokenization domain. This is evident from the influx of companies into this sphere, with exchanges specifically targeting tokenized stocks and exchange-traded fund (ETF) offerings.
Recently, as reported by Cointelegraph, Robinhood, a digital brokerage firm, rolled out a new layer-2 blockchain to facilitate European clients to trade tokenized US stocks and ETFs. In May, Kraken divulged plans to provide tokenized US stock trading to investors outside the US.
Simultaneously, Coinbase, a crypto exchange, is allegedly seeking regulatory sanction to offer tokenized equities, a step that could pit it against Robinhood and other trading platforms.
Earlier this year, Ondo Finance launched Ondo Global Markets to integrate traditional financial markets with the blockchain. The company has been steadily increasing its foothold in onchain finance, recently forming a Global Markets Alliance with several crypto firms to boost adoption of blockchain-based capital markets. On Thursday, OKX Wallet was announced as the newest alliance member.
Ondo enjoys backing from Peter Thiel’s Founders Fund, which is believed to be actively supporting attempts to establish a fresh crypto-friendly bank. The tokenized RWA market is witnessing rapid growth, driven by industry-wide efforts and governmental backing, with SEC Chair Paul Atkins committed to fostering tokenization innovation.
A contemporary industry report jointly authored by RedStone, Gauntlet, and RWA.xyz reveals that the tokenized RWA market has expanded by a staggering 380% since 2022, standing at $24 billion as of June. This figure excludes stablecoins, which are cumulatively worth over $250 billion.
The report by RedStone identifies private credit and US government debt as the primary growth propellers for RWAs.
