Cryptocurrency market data analytics firm Kaiko Research warns that a real-world asset (RWA) project could remain bearish for two main reasons.
In a new report, Kaiko Research says Ondo Finance (ONDO) is losing momentum after hype around RWA projects fades.
The company also warns that expected Fed interest rate cuts in September could further dry up investment flows to Ondo Finance.
The CME’s FedWatch tool indicates that 67.5% of traders and investors expect the Fed to cut interest rates by 25 basis points next month.
“Most of these funds invest in short-term US debt instruments. Other flagship funds include Franklin Templeton’s FBOXX, Ondo Finance’s OUSG and USDY, and Hashnote’s USYC. Each fund offers yields in line with the federal funds rate.
As excitement around these tokenized funds has grown, on-chain flows and the secondary market for associated tokens have seen increased activity. Ondo Finance’s governance token, ONDO, saw the largest increase in trading, coinciding with the announcement of its collaboration with BlackRock’s BUIDL.
ONDO price hit an all-time high of $1.56 in June amid massive BUIDL inflows and growing interest in on-chain funds.
However, the hype has since faded and inflows could face headwinds as the US rate environment evolves.
At the time of writing, Ondo is trading at $0.67. The 77th crypto asset by market cap is down 1.8% in the last 24 hours.
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