Case Study: Ondo Short Term US Government Bond Fund advances compliant RWA tokenization with Digital Asset

Ondo Short Term US Government Bond Fund streamlines token transfers and KYC compliance with Digital Asset

The Ondo Short Term US Government Bond Fund needed to tokenize its real-world assets (RWAs) on a blockchain while ensuring strict compliance with anti-money laundering and counter-terrorism financing regulations. Their challenge was that standard token implementations on EVM chains, like ERC20, lacked built-in mechanisms for KYC verification and transfer restrictions. They partnered with Digital Asset to implement a compliant solution using the Daml programming language on the Canton Network.

Digital Asset implemented a solution using an asset registry and transfer agent model in Daml. This approach integrated with existing off-ledger KYC systems by issuing on-ledger credentials to verified parties and used Canton's programmable privacy features to control data visibility. The result was a secure tokenization framework where transfers automatically verify recipient credentials, ensuring regulatory compliance without sacrificing the ability to compose complex workflows like Delivery vs. Payment.

Ondo Short Term US Government Bond Fund