$250 Million Ondo Catalyst Fund Signals ‘Arms Race’ for RWA Tokenization

Key Takeaways

• Ondo Catalyst fund targets $250 million investment in RWA projects
• Tokenized RWA market grew 380% since 2022, reaching $24 billion
• Major exchanges are focusing on developing tokenized stocks and ETF products
• Favorable regulatory environment in the US drives industry growth

Ondo Finance and Pantera Capital are doubling down on real-world asset (RWA) tokenization, launching a $250 million fund called Ondo Catalyst. According to Ondo’s Strategy Director Ian De Bode, the capital will fuel investments in equity and tokens from emerging tech projects – a move that underscores the sector’s momentum amid supportive US regulations.

The two organizations have announced plans to invest $250 million in RWA through a new fund called Ondo Catalyst. According to Ondo’s Strategy Director Ian De Bode, this capital will be allocated to purchase equity and tokens in emerging technology projects.

The Technology Race is Underway

De Bode describes the market as an “arms race,” with exchanges racing to dominate tokenized stocks and ETFs. Robinhood, for example, just launched a Layer-2 blockchain for European traders to access U.S. tokenized stocks and ETFs. Meanwhile, Kraken plans to offer similar services globally, and Coinbase reportedly seeks regulatory approval to join the competition.

This trend is clearly demonstrated through recent moves by major exchanges. Robinhood has launched a new layer-2 blockchain to enable European customers to trade US tokenized stocks and ETFs. Similarly, Kraken has announced plans to provide US tokenized stock trading services for international investors.

Meanwhile, cryptocurrency exchange Coinbase is reportedly seeking regulatory approval to offer tokenized stocks, a strategic move to compete with Robinhood and other trading platforms.

Ondo Finance Expands Ecosystem

Beyond funding, Ondo is expanding its ecosystem. It recently formed a Global Markets Alliance – now including OKX Wallet – to accelerate blockchain-based capital markets. The firm also launched Ondo Global Markets, aiming to bridge traditional finance with blockchain, and is backed by Peter Thiel’s Founders Fund to build a crypto-friendly bank.

Earlier this year, Ondo launched Ondo Global Markets with the goal of bringing traditional financial markets onto the blockchain platform. Notably, the company is backed by Peter Thiel’s Founders Fund and is actively building a new crypto-friendly bank.

RWA Market Explodes Strongly

This growth is getting a regulatory tailwind. SEC Chair Paul Atkins has pledged to foster tokenization innovation, shifting focus from “regulation by enforcement” to actively promoting market development which is a significant pivot for the industry.

After a period of management characterized by “regulation through enforcement,” the SEC under Atkins’ leadership is now focusing on “how to promote innovation in the market.”

The numbers speak volumes: The tokenized RWA market hit $24 billion in June – a 380% surge since 2022 (*excluding stablecoins’ $250B+*). Private credit and U.S. government debt, per RedStone’s report, are the key engines behind this boom.

According to RedStone’s report, private credit and US government debt are the main growth drivers propelling the development of the tokenized RWA market.