Former Goldman Sachs Staff Launch DeFi Platform Ondo with $4M Funding Round

Ondo Finance DeFi protocol, launched by two former Goldman Sachs employees, has raised $4 million through an equity funding round.

This equity funding led by Pantera Capital, including other participators such as The LAO, Protoscale Capital, Divergence, Chapter One, CMS, Digital Currency Group, CoinFund, Bixin, Genesis, as well as 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 (founder Aave).

Ondo CEO Nathan Allman, a former staff of Goldman's Digital Assets team, and Ondo's other co-founder, Pinku Surana, a former vice president at Goldman Sachs in a technology team, launched the Ondo Finance DeFi platform after they identified a unique market opportunity to offer a suite of products that would allow institutions get risk-controlled exposure to DeFi products. 

Nathan Allman, CEO of Ondo Finance, talked about the development and stated:

“ 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 seeks to resolve such existing problems in the DeFi sector. Ondo Finance is an Ethereum-based DeFi protocol developed to accelerate DeFi adoption among mainstream investors to capture DeFi yield with transparent and mitigated risk while unlocking higher upside exposures.

The platform allows users to get risk-isolated, fixed yield loans backed by yield-generating crypto assets. Borrowers and lenders contribute capital together in “Ondo Vaults,” which use smart contracts to enforce loan provisions and maximise returns.

Current yields in cryptocurrency markets are volatile rates derived from a complex source of inputs. This is a barrier to entry both for institutional and retail investors who seek yields with defined risk. These are risk-averse investors who are willing to adopt DeFi to maximise returns. However, such investors are exposed to volatile yield, impermanent loss from decentralised exchanges like PancakeSwap, Uniswap etc., and commingled risk from lending protocols such as Aave and Compound.

Meanwhile, Paul Veradittakit, Partner at Pantera Capital, talked about Ondo during the equity fundraising event and said: “Fixed income remains the missing piece that decentralised finance needs to go mainstream. Ondo unlocks downside protection and relative certainty in forecasting returns for institutional investors looking to allocate to the attractive yields in the DeFi space. We are excited to back the Ondo team in their mission to bridge the worlds of DeFi and institutional finance.”