JD Durkin: Next guest joins us now via Zoom. John Hoffman, Managing Director, Head of Product Portfolios at Ondo Finance. John, nice to have you join the show today. You just launched Ondo Intelligent Portfolios, an entire strategy that is packed into a single on-chain token. What’s it all about? How does it actually work?
John Hoffman: Yeah, I mean, maybe taking a step back. So Ondo has really been focused on building the infrastructure to power open, always-on global capital markets. And we started by tokenizing stocks. Then we tokenized Treasuries and ETFs. And now we’re assembling those in a portfolio, as you described.
So a single portfolio token available on-chain, providing instant diversification to a professionally allocated strategy. And I think of the seven that we launched, three of them are powered by BlackRock and four are powered by Ondo. And we’re really opening up a new category of investing here through on-chain portfolio strategies.
JD Durkin: Let me follow up on those three that are designed, or that BlackRock designed for Ondo. What’s the significance of that relationship?
John Hoffman: Yeah. So look, I mean, BlackRock is the largest asset manager in the world. Three of the portfolios are powered by BlackRock in that, you know, BlackRock provided the investment strategy.
So they did the asset allocation, the security selection, the weighting of the underlying components in the three portfolios. And Ondo tokenized those so that they are available to anyone with an internet connection and a wallet outside the United States.
And really, it’s about opening access to investors that previously may not have had exposure to professional money management. And now they can do that through these portfolios.
JD Durkin: John, you’re moving professionally managed portfolios on-chain. Talk to me a bit more, excuse me, about what you most hope or most suspect that really will ultimately unlock for investors.
John Hoffman: Yeah. So look, I think in the first instance, it’s an access play, being able to access these portfolios instantaneously. Professionally allocated diversification in the single click of a button.
But there’s more to it. There’s automation. These run on smart contracts that power the asset allocation, power the invest and divest workflow. The rebalance process is actually automated as well. So taking a lot of the human elements out of portfolio construction, portfolio management, all done, you know, programmatically through smart contracts.
There’s also a control element here, being able to control the asset, hold the asset, custody the asset, you know, send it peer-to-peer to somebody else without an intermediary. All of those, I think, are features that we think will unlock a whole new paradigm of investing for folks globally.
And, you know, I think your last guest was talking a little bit about AI. You know, as these assets become digital, obviously AI can integrate directly. And so, you know, that’s a path that we think will unlock here, not tomorrow, but in the next decade as all assets move on-chain. The intersection with AI is also very, very significant.
And then most importantly, you guys just had the Closing Bell there a couple of minutes ago on the floor. You know, this will enable 24/7 markets as well. So markets that are always on, always available, and delivered through tokenized rails.
JD Durkin: I’ve got about 30 seconds left. John, talk to me a bit more about what this does to serve as the bridge between Wall Street and crypto rails.
John Hoffman: Yeah. Look, I think this paves over the bridge. This is, you know, bringing these two worlds together. You know, I think in the future, we won’t talk about digital and TradFi. We’ll talk about one world of highly efficient finance, you know, fully accessible and available to anyone in the world.
Ultimately, that takes the bridge down and paves a highway for everybody to traffic on, ultimately bringing value to end investors, making things simpler, easier, more convenient, and lower cost and more accessible. That’s the path forward.
JD Durkin: John Hoffman, Managing Director, Head of Product Portfolios at Ondo Finance. Congratulations, John, on all the success. Really grateful for your time to join the show today.
John Hoffman: Thanks for having me. I appreciate it.
