Ondo Launches the First Tokenized Treasury Product on Cosmos

Ondo Finance is launching its US Dollar Yield Token, $USDY, on Cosmos’ asset issuance appchain, Noble, making it the first tokenized treasuries product accessible on the Cosmos ecosystem.

The launch means Cosmos chains including Injective, Helix, Osmosis, and Pyth will be able to leverage $USDY in decentralized finance (DeFi).

Cosmos, also known as the Internet of Blockchains (IBC), is a proof-of-stake blockchain that acts as the central hub to an ecosystem of interoperable appchains built on top of it.

$USDY is a tokenized note that is backed by U.S. Treasuries and bank demand deposits. The product, which is not accessible to non-U.S. individuals or investors, allows for holders to earn yield while using the stablecoin elsewhere in DeFi. The current native yield rate for $USDY is 5.3% APY.

Noble is a routing hub for asset transfers and issuance for Cosmos’ Interchain. The team raised $3.3 million in an investment round led by Polychain Capital in October 2023 and has launched both USDC and USDY on Cosmos, with plans to bring Hashnote’s USYC, and FRAX to the Interchain.

Noble’s cumulative stablecoin market capitalization is $246 million, 99% of which is denominated in USDC, and 1% in USDY.

USDY has a market cap of $323 million compared with USDC’s $33 billion and USDT’s $114 billion.

Upon the announcement, Ondo Finance’s CEO said, “our collaboration with Noble broadens Ondo’s reach to the expansive ecosystem of Cosmos appchains, paving the way for novel decentralized financial applications and their users to benefit from Ondo’s market-leading yieldcoin”.