CryptoSlate
Ondo Finance launched three on-chain portfolio tokens on Sept. 24 using investment strategies developed for Ondo by BlackRock. Ondo High Income (BLKHIon), Ondo Diversified Growth (BLKDIGon) and Ondo High Growth (BLKGRWon) provide economic exposure to diversified baskets. They are securities issued by Ondo, not interests in BlackRock funds.
Why it matters
The products put BlackRock-developed portfolio models into an on-chain format, while leaving implementation and management to Ondo. BlackRock Fund Advisors supplies model allocations but does not make investment decisions for the portfolios or owe tokenholders advisory or fiduciary duties. Ondo chooses how to implement the models, manages the products and may decide whether to apply changes to a model after delivery. As a result, an on-chain portfolio can differ from its corresponding model.
Each token represents economic exposure to a weighted basket that includes Ondo Stocks, which track equities and exchange-traded funds. Holding a token does not give its owner a claim on the underlying funds or securities.
Market impact
Direct minting and redemption with Ondo are limited to eligible non-US investors who complete identity and anti-money-laundering checks. The process also screens for US-person status, restricted jurisdictions and prohibited persons. Tokens may be transferable on-chain subject to restrictions, but holding or receiving one does not make an investor eligible to redeem it with Ondo.
Ondo says peer-to-peer transfers can take place around the clock, including through supported third-party platforms. Transferability does not guarantee a buyer, a particular price or an immediate exit. Investors unable to redeem directly would depend on a willing third-party buyer and the rules and conditions of the venue they use.
Frequently asked questions
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Which three portfolio tokens did Ondo launch?
Ondo launched High Income (BLKHIon), Diversified Growth (BLKDIGon) and High Growth (BLKGRWon).
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Do the tokens give holders ownership in BlackRock funds?
No. They are securities issued by Ondo that provide economic exposure to diversified baskets, not interests in BlackRock funds or claims on underlying securities.
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Who can mint or redeem the tokens directly with Ondo?
Eligible non-US investors who complete Ondo's onboarding, including identity and anti-money-laundering checks, may mint or redeem directly.
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What role does BlackRock play in the on-chain portfolios?
BlackRock Fund Advisors supplies model allocations developed for Ondo. Ondo decides how to implement the models and manages the portfolios.
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Does on-chain transferability guarantee an investor can exit?
No. Transfers do not guarantee a buyer, a particular price or an immediate exit. Investors who cannot redeem directly depend on a willing third-party buyer.
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