CoinDesk
Ondo Finance has abandoned its February 2025 plan for a layer-1 blockchain and instead launched Ondo Network, a private trading system purpose-built for institutions. The new network already powers Ondo Perps, the firm's perpetual futures platform that lets users post tokenized assets as collateral, and is designed to extend into spot markets, lending, structured products and settlement infrastructure.
Orders are executed privately for speed, with final asset transfers settling on public blockchains. That separation is the architectural point: institutions want blockchain settlement but do not want their positions, order flow or trade sizes exposed on a public mempool. A traditional L1, with every order and fill visible on-chain, was the wrong tool for that job.
Why it matters
Ondo is already one of the largest tokenized-asset issuers in the market, with roughly $2.6 billion in tokenized U.S. Treasury products across OUSG and USDY and about $850 million in tokenized equities, per rwa.xyz data. The new network marks a shift from issuer to trading-infrastructure operator, a much higher-margin role as tokenization gathers momentum across Wall Street and perps expand from crypto into equities and commodities.
The launch also lands one week after Ondo's broker-dealer received FINRA approval to run regulated markets for tokenized securities. Together, the pieces outline a full stack: regulated issuance, FINRA-recognised brokerage rails, and now a private execution layer that finally has somewhere institutional flow can live.
Market impact
The most direct read is on tokenized-asset adoption. A venue that lets institutions use OUSG and USDY as perp collateral, with private execution and on-chain settlement, turns previously passive treasury exposure into productive trading collateral without forcing positions onto a public order book. Comparable institutional DeFi venues will face pressure to ship similar privacy layers or risk losing flow to Ondo's stack.
The pivot away from an L1 also recalibrates the competitive landscape for chains courting RWA issuers.
Frequently asked questions
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What is Ondo Network and how is it different from Ondo Chain?
Ondo Network is a private trading system that replaces Ondo's originally planned Ondo Chain layer-1 blockchain. Orders are executed privately for speed, while final asset transfers settle on public blockchains, separating execution from settlement rather than processing every trade on a public L1.
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What does Ondo Perps let users do?
Ondo Perps is the first application on the new network and lets users trade perpetual futures using tokenized assets as collateral, extending tokenized treasuries and equities into derivatives collateral rather than just static holdings.
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How big is Ondo's existing tokenized-asset footprint?
Per rwa.xyz data cited in the announcement, Ondo holds roughly $2.6 billion in tokenized U.S. Treasury products across OUSG and USDY, plus about $850 million in tokenized equities, making it one of the largest issuers in the sector.
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Why did Ondo abandon its layer-1 blockchain plan?
Ondo concluded after building Ondo Perps that a traditional blockchain was the wrong tool for the speed and privacy institutional trading requires. A public L1 exposes order flow and positions on-chain, which institutions are unwilling to accept.
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What regulatory milestones back the new network?
Ondo's broker-dealer received FINRA approval last week to operate regulated markets and services for tokenized securities, giving the firm a recognised brokerage rail alongside its new private execution layer.
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