Ondo Finance has raised $20 million in a Series A funding round designed to support its project of “building a decentralized investment bank,” the company said in a news release Wednesday (April 27).
The round was led by Peter Thiel’s Founders Fund and Pantera Capital, and will let Ondo expand its team and support product launches that include its multi-chain expansion.
“Ondo Finance is building a decentralized investment bank focused on connecting stakeholders in the emerging DeFi ecosystem, including decentralized autonomous organizations (DAOs), institutions, and retail investors,” the release said. “As its first offering, the company built a novel primitive for decentralized structured products that offer choice between downside protection and enhanced returns.”
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From there, Ondo expanded to other use cases, including its Liquidity-as-a-Service (LaaS) offering, which matches DAOs with underwriters to provide liquidity for a DAO’s native token, allowing users to easily trade its token in decentralized exchanges.
“Decentralized finance” refers to systems of peer-to-peer financial transactions, typically using the Ethereum blockchain.
In the next few months, Ondo says it aims to launch additional products designed to increase “the breadth, usefulness, and accessibility of its offerings,” including vaults that bundle yields from algorithmic stablecoins along with vaults that aggregate yield across different blockchains.
“The growth of algorithmic stablecoins and expansion of DeFi from Ethereum to other blockchains has led to tremendous yield opportunities but with greater complexity and risks,” said Paul Veradittakit, partner at Pantera Capital. “Ondo will make it possible for investors to get passive exposure to this increasingly scattered but abundant yield while receiving downside protection or enhanced returns.”
Ondo’s Series A comes days after venture capital fund Framework Ventures Management announced it had wrapped a $400 million fundraise to invest in “early-stage blockchain gaming, Web3, and DeFi startups and networks.”