Ondo Finance CEO Nathan Allman indicated that the increased focus on stablecoins would accelerate the tokenization of other real-world assets, signaling a broader shift in the blockchain landscape.

Interview Excerpts

Blockworks: What did you think of the investor demand around Circle’s IPO?

Allman: Stablecoins are by far the largest real-world asset class achieving substantial product-market fit. They exemplify the benefits of accessibility, particularly for underserved regions, more than purely efficiency gains, which are equally important.

In his view, Circle’s successful IPO has amplified interest, creating momentum for on-chain assets. CRCL stock notably surged 70% following the Senate’s GENIUS Act, opening at $250. Allman perceives this as “the tip of the iceberg” for stablecoin advancement.

Cryptocurrency remains the tip of the iceberg, not blockchain beyond that. The article’s examples of trillion-dollar tokenization projections may lose significance, as settlement shifts onto chains like Ethereum, potentially permissioned, before utility expands further.

Tokenization of other asset classes hinges on standardization, according to Allman. While tokenized Treasuries via Ondo are in the pipeline, syndicated loans and illiquid assets require additional digitization before they yield real-world returns for investors.

The Ondo CEO also discussed the U.S. SEC meeting, seeing them as agreeable and engaging, increasing optimism for future partnerships and enhanced liquidity, including Ondo’s aim to tokenize publicly traded securities for the U.S. market.

Furthermore, Allman highlighted differentiation from traditional players by enhancing infrastructure access and adding utility layers to tokenized securities, positioning Ondo as an ecosystem player, not just an issuer.

Toknization’s Near-Term Focus

Despite lofty valuations for widespread asset tokenization, Allman stressed that the realization will be more evolutionary than revolutionary. Key points include:

• Market interest, underscored by Circle’s IPO and CRCL’s performance, is spurring small-to-mid market asset tokenization.
• Efficiency and reduced settlement times remain core benefits alongside enhanced accessibility.
• Illiquid assets still require significant documentation standardization before broad accessibility results.
• The future involves a gradual abstraction of settlement processes onto blockchains.
• Ondo is focused on vertically integrated infrastructure for tokenized securities, leveraging its Ondo Chain.

Allman confirmed that while tokenization won’t inherently liquidate illiquid assets, it can’t hurt. Players like BlackRock and Apollo Global Management are experimenting with tokenized private funds, paving the way for broader adoption.