Trust & Security

When dealing with money, trust and security are always important. In crypto, these issues are even more top of mind. We therefore wanted to highlight a few of the many ways we are committed to maintaining your trust and the security of your funds.

Institutional Partners

Even within TradFi, setting up and operating any given fund involves many parties, such as asset managers, custodians, fund administrators, counterparties, lawyers, and more. And that list only gets bigger in onchain finance, particularly when connecting onchain capital to off-chain assets. Simply put, partners matter.

At Ondo, we work with only the most reputable, well-established partners across all functions. For instance, with OUSG (Ondo Short-Term US Government Treasuries), the USDC you invest is exchanged for USD by Coinbase, one of the leading crypto asset custodians. Furthermore, over 99.5% of the Fund’s assets are currently invested in the BlackRock USD Institutional Digital Liquidity Fund (BUIDL), managed and sponsored by BlackRock, one of the world's preeminent asset management firms and a premier provider of investment management services. BUIDL’s assets are custodied at BNY Mellon, a Systemically Important Bank which oversees nearly $50 trillion in assets for their clients. Additionally, US Treasuries - the primary underlying assets of BUIDL - are backed by the full faith and credit of the United States government, and largely considered to be one of the lowest-risk assets in the world.

For all of our products, the principle is the same: high quality institutional partners, always.

Transparency & Disclosure

We believe the standards for transparency and disclosure in onchain finance should meet or exceed those in TradFi. Whenever possible, we try to be transparent with our product and protocol details. As an example, if you visit the product page for any of our funds, you will find detailed information on all relevant dimensions, including the strategy employed, the underlying portfolio composition, historical performance and risk, as well as the results of periodic fund audits. On the technical side, our smart contracts have successfully completed audits from some of the leading firms in the industry, and these audits are published here: https://docs.ondo.finance/audits (opens in a new tab). Finally, Ondo and its related entities regularly undergo financial and information security audits, which are shared with authorized requesting parties.

Legal & Regulatory Compliance

At Ondo, we know that legal and regulatory compliance is a critical pillar of tokenized real-world-asset offerings. We take a thorough and measured approach to risk management in general, with a compliance-oriented product design that is rooted in consultation with a variety of legal, tax, and regulatory experts.

Ondo I LP (OUSG)

The Fund is structured using a traditional GP/LP model. Investors become limited partners in the Fund by acquiring OUSG tokens, each of which represents a unitized limited partnership interest in the Fund. The Fund is managed by its General Partner, Ondo I GP LLC, a Delaware limited liability company and wholly owned subsidiary of Ondo Finance. The Fund’s Investment Manager is Ondo Capital Management LLC, a Delaware limited liability company and wholly owned subsidiary of Ondo Finance. Proceeds of each purchase of OUSG from the Fund are invested by the Investment Manager into US Treasuries products.

The Fund is further structured as a private fund under Section 3(c)(7) of the Investment Company Act of 1940 (the “40 Act”), which exempts the Fund from registration as an investment company. Accordingly, OUSG is only available to Qualified Purchasers as defined in the 40 Act. OUSG is offered and sold by the Fund in reliance on Rule 506(c) of Regulation D under the Securities Act of 1933 (the “33 Act”), which exempts OUSG from the securities registration requirements. Accordingly, OUSG can only be acquired by verified Accredited Investors as defined in Regulation D. Investors also must undergo customer due diligence for anti-money laundering, countering terrorist financing, and sanctions compliance purposes, which is administered by the General Partner.

Ondo USDY LLC (USDY)

Ondo USDY LLC (the “USDY entity”) is structured as a special purpose vehicle whose activities are limited to (1) borrowing funds from prospective lenders, (2) issuing USDY tokens to evidence the LLC’s debt obligations to those lenders, (3) allocating the proceeds of borrowing to US Treasuries and US bank demand deposits, (4) creating and perfecting a security interest in its assets, and (5) related incidental activities.

USDY is offered and sold by the USDY entity in reliance on Regulation S under the 33 Act, which exempts USDY from the securities registration requirements. Accordingly, USDY can only be issued and sold by the LLC to non-US persons in transactions outside the US. Ondo USDY LLC is also registered as a money services business with the Financial Crimes Enforcement Network of the US Department of the Treasury (“FinCEN”). Investors also must undergo customer due diligence for anti-money laundering, countering terrorist financing, and sanctions compliance purposes in accordance with the anti-money laundering program that the LLC has adopted to comply with the US Bank Secrecy Act.