06/21/24

Altcoin Spotlight: Ondo Token (ONDO)

Here at MintDice.com, we are committed to offering the best in customer education, which is one of the many reasons we started our Altcoin Spotlight program. The weekly or biweekly article discussing an alternative cryptocurrency that isn’t as widely known.

Not all coins featured in our altcoin spotlight are good purchases, but they aren’t always bad either, and we try to highlight that as we go through the basics, creators, and more. This week, we are discussing the Ondo token, so if you would like to learn more about this unique project, keep reading.

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What is Ondo?

Ondo is a governance token that is connected to a platform of the same name of institutional-grade investment tools. The Ondo platform is a project which is devoted to helping companies tokenize their own assets as well as providing cryptocurrency backed loans to high-level clients.

Ondo also functions as a cross-chain conversion mechanism, providing a way for clients to change over their held cryptocurrencies, specifically for the purpose of tokenizing, liquidity pools, or applying for a crypto loan.

Additionally, Ondo operates a little bit like a financial company, connecting companies with the service providers they need to accomplish various tasks. Some of these tasks include (but aren’t limited to):

· Liquidity provision

· Investment in fiat investments with cryptocurrencies

· Creating yield-generating tokens from existing fiat financial tools

· And more

Basically, in plain language, Ondo is a platform that connects the cryptocurrency world with the fiat one, allowing companies to offer unique hybrid solutions to their customers.

How Does Ondo Work?

ONDO, the token behind the Ondo platform, is a governance token. That means those who invested in the platform were given tokens, giving them a say in the future of the platform as a whole. This say is recorded in the form of votes, of which certain individuals are given a different number of votes based on their token holdings.

You don’t have to buy ONDO to use the platform, but you do have to hold some if you want to use the FLUX trading platform. Non-holders and holders alike can simply go to their website and sign up to begin their investing journey.

Although Ondo provides several DeFi services, it's important to note that they do follow all KYC policies as they tokenize US government-based investments (bonds) and report everything to the US government. This means you are free to use the platform but will need to prove your identity in order to do so. It is also worth noting that Ondo was designed for institutional investors, and therefore, they are likely to deny low-level personal accounts, which will not help their bottom line.

Who Created Ondo?

Ondo Finance, the company behind the Ondo token, was founded by Nathan Allman, a former Goldman Sachs employee. He founded it in 2021, though the platform didn’t get its first customers until 2023.

Nathan builds Ondo Finance for the purpose of connecting real-world investments to the cryptocurrency world via tokenization. He started his connection with the Ethereum platform but has since expanded to many other platforms in the space, such as Solana, Sui, Aptos, Injective, Mantle, and Polygon.

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Should You Buy Ondo?

Honestly, this project doesn’t seem like a bad one, as it is formally regulated by the US government, and they are very open about their practices and policies. That being said, Ondo is not a good investment for those who aren’t involved on an institutional level.

A quick look at the platform’s website reveals that they cater mostly to institutional clients, offering tokenization solutions for a variety of goods. They also provide liquidity to large exchanges such as Coinbase, BlackRock, and Morgan Stanley. Additionally, they are centralized, even though they provide some DeFi services, meaning they don’t offer the privacy most other crypto investments do. Therefore, we just have a hard time believing there is a benefit in Ondo for the average investor.

Of course, an Ondo investment means that you have some governing rights over the platform, but because this platform isn’t truly DeFi, we have a hard time trusting that you would be able to purchase enough tokens to make a difference(as the creator and CEO likely hold much of the tokens themselves). Plus, any investment in Ondo would be for governance purposes, as we don’t think these tokens are investment grade on their own.

If you do decide to buy Ondo, ensure you have a plan for the tokens, or are passionate about the future of the platform. If you are looking for a simple investment for monetary purposes, we recommend considering Bitcoin or Ethereum instead. We don’t recommend an Ondo investment at all for those new to the cryptocurrency investing space.

Where Can You Buy Ondo?

If you do decide that an investment in Ondo is a good idea for your wallet, you can make your purchase of the tokens on the following platforms:

· Binance

· DOEX

· Bybit

· BYDFI

· DigiFinex

Of course, it may be available on some additional platforms that are not mentioned here. These are just the ones we are currently aware of.

Where To Learn More About the Ondo Project?

If you are interested in possibly using Ondo at the institutional level or just learning more about the project, you can head over to their website or take a look at this article on Forbes. Because Ondo is backed by several large companies (Namely BlackRock), there is a lot of information available for those who are interested.

Overall, while Ondo isn’t a bad platform, it just isn’t something we see ourselves investing in. Not only is it a governance token, but it is also a very centralized platform, something we prefer to avoid when investing in cryptocurrency. Ondo might be a decent investment for some people; however, just be sure you do your research and discuss your decision with someone you trust before buying.

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