Ondo US Dollar Yield USDY

USDY is an interest-bearing note in token form, backed by short-dated US Treasury obligations and bank deposits, with the portfolio's income passed to the holder. Ondo Finance issues it through a ring-fenced entity kept separate from the company's own balance sheet, and the collateral sits with an outside custodian and is disclosed in regular reports. Legally it is that entity's obligation, not a promise by the company itself.

The difference from a settlement stablecoin is fundamental. The token does not promise a price of exactly one dollar: the base version appreciates as interest accrues, while a parallel variant delivers the same return by increasing the token count at a fixed price. This is a debt instrument, not a means of payment.

Access is restricted — primary purchase is closed to US persons and requires identity checks, and transfer is possible only after a set holding period. Buyers want dollar yield on-chain rather than instant settlement, and the decisive question is disclosure quality rather than technology.

USDY earns yield and is therefore not a payment token: its price is not one dollar, and using it as a settlement unit is a misuse.