ONDO

Ondo's infrastructure is built on blockchain technology, notably within the Ethereum Ecosystem, and is developing its own dedicated layer-1 blockchain, Ondo Chain, specifically for institutional-grade Real World Assets (RWA). The platform utilizes APIs and SDKs to empower third-party developers, enabling the creation of innovative financial applications using its tokenized assets. Smart contracts are central to its operations, ensuring transparent and efficient management of digital asset minting, redemption, and transfers. Ondo's technology arm also builds protocols like Flux for borrowing and lending, and Nexus for asset issuers, enhancing the overall DeFi landscape.

Flux exclusively accepts OUSG (tokenized US Treasuries) as collateral, unlike most DeFi protocols that use volatile crypto assets. This collateral is backed by BlackRock's BUIDL fund and other Treasury instruments, creating fundamentally different risk parameters. Borrowers must undergo KYC verification when using OUSG, while lenders remain permissionless. This dual-layer architecture merges traditional finance compliance requirements with DeFi's open accessibility.

fTokens represent tokenized loans with three key technical advantages: 1) They automatically accumulate interest through rebasing mechanics; 2) Maintain full ERC-20 compatibility for DeFi composability; 3) Enable novel use cases like collateral rehypothecation in other protocols. When users lend USDC to Flux, they receive fUSDC tokens that continuously appreciate relative to the underlying asset, functioning as liquid yield positions without manual claiming.

The governance process employs a two-stage security protocol: forum discussion followed by on-chain voting. Smart contract upgrades require a 100 million ONDO proposal threshold and pass through Compound's battle-tested Governor Bravo system. Critical parameter changes undergo additional scrutiny from designated security committees. The DAO can implement emergency pauses through multisig-controlled functions, creating layered security combining community governance and technical safeguards.

Integrating new RWAs presents three primary technical challenges: 1) Developing compliant permissioning systems specific to each asset class; 2) Creating reliable price oracles for non-crypto assets; 3) Establishing legal wrappers accommodating different jurisdictions. Flux's architecture addresses these through modular permission adapters, third-party oracle integrations, and asset-specific KYC frameworks. Current governance proposals focus on automating these components for scalable RWA expansion.

The protocol employs five key security measures: 1) Circuit breakers for price deviations; 2) Time-weighted price feeds from multiple sources; 3) Collateral factors below traditional thresholds (0% for stablecoins); 4) Formal verification of core mathematical functions; 5) Continuous auditing through bug bounties. These technical controls, combined with Compound's battle-tested foundation, create defense layers against oracle exploits, flash loans, and economic attacks.