The Ondo Finance DeFi protocol, founded by two former Goldman Sachs employees, has received a $4 million equity investment round.
The LAO, Protoscale Capital, Divergence, Chapter One, CMS, Digital Currency Group, CoinFund, Bixin, Genesis, and angel investors like Christy Choi (former Head of Investments at Binance), Diogo Monica (co-founder Anchorage), Richard Ma (founder Quantstamp), Josh Hannah (founder Betfair), and Stani Kulechov participated in this equity funding led by Pantera Capital (founder Aave).
Ondo Finance DeFi was founded by Nathan Allman, a former member of Goldman Sachs’ Digital Assets team, and Pinku Surana, a former vice president in a technology team at Goldman Sachs. They saw a unique market opportunity to offer a suite of products to allow institutions to get risk-controlled exposure to DeFi products.
Ondo Finance’s CEO, Nathan Allman, commented on the situation, saying:
“We see a huge opportunity to bring a wider array of products from traditional finance to DeFi and create new financial primitives. We are grateful for the support of our investors who recognise the immense potential for DeFi to democratise access to a wide range of financial services previously only accessible to institutions.”
Ondo is a new DeFi primitive that aims to tackle some of the industry’s current issues. Ondo Finance is an Ethereum-based DeFi protocol that aims to increase DeFi acceptance among mainstream investors by allowing them to capture DeFi income while reducing risk and increasing upside potential.
Users may receive risk-isolated, fixed-yield loans secured by yield-generating crypto assets through the platform. Borrowers and lenders pool their funds in “Ondo Vaults,” which employ smart contracts to enforce loan terms and maximize profits.
In cryptocurrency markets, current yields are fluctuating rates generated from a complicated set of inputs. This is a barrier to entry for both institutional and individual investors looking for risk-adjusted returns. These are conservative investors who are prepared to use DeFi to increase their returns. However, decentralized exchanges like PancakeSwap, Uniswap, and others subject such investors to fluctuating yield, impermanent loss, and commingled risk from lending protocols like Aave and Compound.
Meanwhile, Pantera Capital Partner Paul Veradittakit highlighted Ondo at the equity fundraising event, arguing that fixed income is still the missing piece for decentralized finance to gain traction. Ondo provides downside protection and high accuracy in projecting returns for investors interested in the DeFi industry’s attractive yields. They’re excited to help the Ondo team achieve their aim of bridging the gap between DeFi and institutional finance.