OpenTrade, a key player in the institutional DeFi sphere, introduces tokenized treasury bonds. Collaborating with technology developed by Circle, the company opens the door for real assets in the world of USDC digital currency. But what does this mean for investors and what benefits does this move bring?
When we hear about cryptocurrencies, we primarily think of Bitcoin or Ethereum. However, the world of digital finance is much more complex. Recent actions by OpenTrade indicate that the boundaries between traditional and digital finance are becoming increasingly fluid.
With the support of Circle’s technology, OpenTrade introduces a product based on tokenized treasury bonds. For every tokenized treasury bond purchased by an investor, OpenTrade acquires a real treasury bond and delivers a digital identifier of that asset. This action aims to increase transparency in an industry that desperately needs it.
An additional advantage is the ability to collateralize loans in USDC against treasury bonds. This will allow lenders to earn returns on investments while fully functioning within blockchain technology, using existing wallets and custodians.
Interestingly, the entire protocol is based on technology developed by Circle – the Perimeter Protocol. Jeff Handler, co-founder and Chief Trading Officer of OpenTrade, emphasizes that this is a “tried and tested tech stack.” The Perimeter Protocol was created with the global use of USDC in mind, which is applicable in OpenTrade’s operations.
Handler also notes that their new product will be available to accredited individual investors, companies, funds, DAOs, regulated institutions, and “third-party partners.” Although the product will not be available in the US for now, it opens new possibilities for investors worldwide.
While cryptocurrencies and blockchain technologies still spark controversy, especially among traditional banking institutions, initiatives like OpenTrade show that the sector is ready for groundbreaking innovations. Virtually risk-free products, like digital treasury bonds, might be an attractive proposition for many investors looking for alternatives to traditional investment methods.
It’s worth noting Handler’s words, believing that his company is at the forefront of a product that needs time to gain recognition in the traditional financial system. However, considering the pace of blockchain technology’s development, it won’t take long.
Photo by Jason Dent on Unsplash
