Audit log

Every state-changing event for Ondo US Dollar Yield (USDY): moderation decisions on community submissions, plus corrections and updates from the news pipeline. URL-based decisions carry three independent witnesses — the original source, an Internet Archive snapshot taken at submission time, and a Solana memo signed by our publicly-disclosed publisher key.

1. #1publishby system:backfill

   2026-07-22 12:09:40Z
   Score: ? → ? (no score change)
   anchorpending

   chain

   ●—

   hash

   HNUuejYUezUK…k5WKgW3Lcopysha256 → base58

   verifying row…

   canonical bytes (22173 B) ▸

   {"actor":"system:backfill","investigation_id":"821c154a-56ee-4fd0-96e5-716742622713","kind":"publish","page_slug":"ondo-us-dollar-yield-usdy","published_at":"2026-07-22T12:09:40.495Z","sequence_num":1,"snapshot":{"content_type":"investigation","entity_name":"Ondo US Dollar Yield (USDY)","sections":[{"content":"USDY is a tokenized note first launched on August 3, 2023 by Ondo Finance under its subsidiary Ondo USDY LLC, described at launch as the world's first tokenized note secured by U.S. Treasuries and bank deposits. Holders of USDY hold senior secured debt claims against Ondo USDY LLC, a Delaware-domiciled special purpose vehicle structured to be bankruptcy-remote from Ondo Finance's parent operations. The proceeds raised are invested in a portfolio comprising short-term U.S. Treasury bills, shares of the iShares Short Treasury Bond ETF, and bank demand deposits, with a security interest perfected for token holders. The structure includes an approximately 3% first-loss equity cushion subordinate to token holder claims. Ankura Trust Company serves as the independent verification agent, publishing daily attestations of underlying reserve levels. The portfolio is also subject to monthly independent audit review. As of December 15, 2025, Ondo USDY LLC was folded into the Ondo Stocks product umbrella, though USDY continued to operate under its existing structure.","heading":"Product Overview and Legal Structure","severity":"low","sources":[{"credibility":1,"name":"Introducing Ondo USD Yield (USDY) - Ondo Finance Blog","type":"official","url":"https://ondo.finance/blog/introducing-ondo-usd-yield-usdy"},{"credibility":1,"name":"USDY Basics - Ondo Finance Documentation","type":"official","url":"https://docs.ondo.finance/general-access-products/usdy/basics"},{"credibility":1,"name":"Ondo USDY LLC Eligibility - Ondo Finance Documentation","type":"official","url":"https://docs.ondo.finance/general-access-products/usdy/faq/eligibility"}]},{"content":"USDY is available in two token variants. The accumulating version (USDY) reflects earned yield through a rising per-token redemption price; as of April 2026, USDY traded at approximately $1.14, reflecting approximately 14% cumulative yield since the August 2023 launch. The rebasing version (rUSDY) maintains a fixed $1.00 price and delivers yield through the automatic daily distribution of additional tokens, making it better suited for settlement and accounting purposes. The yield rate is tied to prevailing short-duration U.S. Treasury yields; at launch in August 2023 the rate was 5% APY, declining to approximately 4.65% APY by April 2026 as the Federal Reserve's rate cycle progressed. Minting requires a minimum subscription of $100,000 via bank wire or USDC, creating a practical institutional minimum for direct issuance; however, USDY can be acquired in smaller amounts on secondary DEX markets such as Curve (Ethereum) and Orca (Solana). A 40-to-50 business day waiting period applies before newly minted USDY tokens are freely transferable, though yield accrues during this restriction window.","heading":"Yield Mechanism and Token Versions","severity":"low","sources":[{"credibility":1,"name":"USDY Basics - Ondo Finance Documentation","type":"official","url":"https://docs.ondo.finance/general-access-products/usdy/basics"},{"credibility":2,"name":"Ondo USDY: Tokenized Treasuries Explained - Eco Support","type":"other","url":"https://eco.com/support/en/articles/14798657-ondo-usdy-tokenized-treasuries-explained"},{"credibility":2,"name":"What is Ondo US Dollar Yield (USDY) and how does it work - Bybit Learn","type":"other","url":"https://learn.bybit.com/en/stablecoin/what-is-ondo-us-dollar-yield-usdy"}]},{"content":"USDY is offered under the Regulation S exemption from U.S. securities registration, which restricts availability strictly to non-U.S. persons and entities. U.S. persons are categorically prohibited from subscribing for, acquiring, or redeeming USDY under the terms of the offering. In the European Economic Area and the United Kingdom, USDY is offered solely to qualified investors; in Switzerland it is offered solely to professional clients. Ondo Finance was subject to a confidential SEC investigation that commenced in October 2023 under then-Chair Gary Gensler. The investigation examined whether Ondo's tokenization of U.S. Treasuries and equities complied with federal securities laws and whether the ONDO governance token constituted an unregistered security. On December 8, 2025, the SEC formally notified Ondo Finance that the probe had been closed with no charges, fines, or enforcement action. The closure occurred under new SEC Chair Paul Atkins, who has publicly characterized tokenization as transformative financial innovation. Ondo subsequently engaged with the SEC's Crypto Task Force via written submissions in December 2025 and April 2026, proposing frameworks for the onchain migration of securities markets. The regulatory status of USDY as a non-U.S. security instrument under Regulation S has not been formally challenged by any regulator as of mid-2026.","heading":"Regulatory Status and SEC Investigation","severity":"medium","sources":[{"credibility":1,"name":"RWA Tokenization News: SEC Ends Probe into Ondo - CoinDesk","type":"news_article","url":"https://www.coindesk.com/markets/2025/12/08/ondo-token-gains-as-sec-ends-investigation-into-rwa-tokenization-platform"},{"credibility":2,"name":"SEC Drops Biden-Era Investigation Into Ondo Finance - Unchained Crypto","type":"news_article","url":"https://unchainedcrypto.com/sec-drops-biden-era-investigation-into-ondo-finance/"},{"credibility":1,"name":"Ondo Finance Written Input to SEC CTF - April 2026","type":"regulatory","url":"https://www.sec.gov/files/ctf-written-input-ondo-finance-041326.pdf"},{"credibility":1,"name":"Ondo Finance Written Input to SEC CTF - December 2025","type":"regulatory","url":"https://www.sec.gov/files/ctf-written-input-ondo-finance-120425.pdf"},{"credibility":1,"name":"Regulatory Compliance - Ondo Finance Docs","type":"official","url":"https://docs.ondo.finance/qualified-access-products/ousg/regulatory-compliance"}]},{"content":"Ondo Finance has commissioned multiple independent smart contract audits across its contract suite. For the Ondo Funds and USDY Ethereum contracts, publicly disclosed audits include a Spearbit audit in March 2025, a Halborn audit in February 2025, a Code4rena competitive audit in April 2024, and a Cyfrin audit in April 2024. For USDY deployed on the Noble blockchain (Cosmos ecosystem), Halborn conducted audits in June 2024 and July 2024. All audit reports are stated to be publicly available in Ondo's documentation. A notable pre-USDY security incident occurred in January 2022, when security researcher Ashiq Amien disclosed through Immunefi that the Ondo Finance TrancheToken smart contract implementation was left uninitialized, making it susceptible to a selfdestruct attack that would have bricked all associated proxy contracts. If a token minting flag had been active at the time, the exploit could have enabled an attacker to drain approximately $50 million from UniswapStrategy contracts. The minting flag was not active, so no user funds were at risk. Ondo patched the vulnerability promptly and awarded a $25,000 bounty. This vulnerability predates the USDY product by approximately 18 months and involved the earlier Ondo Structured Finance product. LlamaRisk's asset overview identified that the RWADynamicRateOracle contract used for USDY price updates is operated by externally owned accounts (EOAs), meaning price-setting for minting and redemption is a centralized operation dependent on trusted internal actors rather than a decentralized or algorithmic feed. The allowlist governing which wallet addresses may receive USDY is implemented via an upgradeable smart contract, which LlamaRisk identified as introducing denial-of-service risk to existing holders if terms are modified and re-onboarding is required.","heading":"Smart Contract Security and Audit History","severity":"medium","sources":[{"credibility":1,"name":"Smart Contract Audits - Ondo Finance Docs","type":"official","url":"https://docs.ondo.finance/audits"},{"credibility":2,"name":"High Risk Vulnerability Disclosed to Ondo Finance - iosiro","type":"research","url":"https://www.iosiro.com/blog/high-risk-vulnerability-disclosed-to-ondo-finance"},{"credibility":2,"name":"Asset Overview: U.S. Dollar token (USDY) - LlamaRisk","type":"research","url":"https://llamarisk.com/research/archive-llamarisk-asset-overview-u-s-dollar-token-usdy"},{"credibility":2,"name":"Ondo Finance Bug Bounties - Immunefi","type":"other","url":"https://immunefi.com/bug-bounty/ondofinance/"}]},{"content":"The USDY reserve portfolio is composed of short-term U.S. Treasury bills, iShares Short Treasury Bond ETF shares, and bank demand deposits. While U.S. Treasury instruments carry the credit backing of the federal government, the bank deposit component introduces counterparty risk not present in a pure T-bill structure. LlamaRisk's analysis noted that at least 65% of the underlying reserve held in bank deposits remains uninsured by FDIC coverage limits, exposing a material portion of reserves to bank counterparty risk in a stress scenario. In such a scenario, frozen or failed bank deposits could delay or reduce redemptions even if the Treasury component remains intact. Token holders are creditors of Ondo USDY LLC rather than direct owners of the underlying securities; the quality of legal enforceability of their claim in a bankruptcy scenario, while structured to be remote, remains dependent on documentation, collateral agent performance, and court proceedings. LlamaRisk also noted that the mechanism by which token holder approval would technically execute during financial distress of the SPV was, at the time of their analysis, still being determined. Ankura Trust serves as verification agent providing daily attestation of reserve levels, and an independent auditor reviews the portfolio monthly. No reserve shortfall or attestation failure has been publicly reported as of mid-2026.","heading":"Reserve and Counterparty Risks","severity":"medium","sources":[{"credibility":2,"name":"Asset Overview: U.S. Dollar token (USDY) - LlamaRisk","type":"research","url":"https://llamarisk.com/research/archive-llamarisk-asset-overview-u-s-dollar-token-usdy"},{"credibility":2,"name":"Risks of Yield-Bearing Stablecoins 2026 - Eco Support","type":"other","url":"https://eco.com/support/en/articles/15253999-risks-of-yield-bearing-stablecoins-2026-depeg-smart-contract-counterparty"},{"credibility":1,"name":"Trust and Transparency FAQ - Ondo Finance Docs","type":"official","url":"https://docs.ondo.finance/general-access-products/usdy/faq/trust-and-transparency"}]},{"content":"USDY is not available to U.S. persons under any circumstances. Direct minting via Ondo's platform requires completion of KYC, identity verification, and submission of legal and tax forms; the process is conducted entirely online. The standard direct-issuance minimum is $100,000, making primary-market access institutional in practice. An alternative onboarding path for certain blockchain networks carries a lower minimum of $5,000. Non-U.S. retail participants can acquire USDY in smaller amounts through secondary DEX markets without completing KYC with Ondo directly, though the token's on-chain allowlist mechanism is intended to restrict secondary transfers to verified addresses. Each USDY transfer requires an on-chain allowlist check, which increases per-transaction gas costs and can complicate integration with DeFi liquidation engines on high-cost networks. The product is not available to residents of the United States or to entities with U.S. beneficial owners, and the Regulation S offering structure means that any transfer to a U.S. person would constitute a violation of the terms of the instrument. The secondary market availability of USDY on public DEXs without mandatory KYC screening creates a potential compliance gap that Ondo has acknowledged but not fully resolved at the protocol level.","heading":"Access Restrictions and User Eligibility","severity":"medium","sources":[{"credibility":1,"name":"Ondo USDY LLC Eligibility - Ondo Finance Docs","type":"official","url":"https://docs.ondo.finance/general-access-products/usdy/faq/eligibility"},{"credibility":1,"name":"Onboarding and KYC - Ondo Finance Docs","type":"official","url":"https://docs.ondo.finance/general-access-products/usdy/faq/onboarding-and-kyc"},{"credibility":2,"name":"Asset Overview: U.S. Dollar token (USDY) - LlamaRisk","type":"research","url":"https://llamarisk.com/research/archive-llamarisk-asset-overview-u-s-dollar-token-usdy"}]},{"content":"At launch in August 2023, USDY was deployed exclusively on Ethereum. By early 2026, the token was live on at least ten blockchains: Ethereum, Solana, Mantle, Sui, Aptos, Arbitrum, Noble (Cosmos), Stellar, Sei, and BNB Chain. Solana hosts approximately 35% of the total USDY float as of early 2026. Total USDY supply grew from approximately $60 million at launch to over $740 million by early 2026, crossing the $1 billion TVL threshold in March 2025. The token has been characterized in industry analysis as the most chain-distributed of the major tokenized-Treasury wrappers, and is broadly regarded as the de facto standard for cross-chain allocation to short-duration government debt among non-U.S. DeFi participants. USDY is integrated into multiple DeFi protocols across its supported chains, including Curve and Morpho (Ethereum), Orca (Solana), Cetus, Aftermath, and Suilend (Sui), and Aerodrome (Base, via bridge). Ondo Finance as a whole reported approximately $3.78 billion in total value locked across all products as of mid-2026.","heading":"Market Position and Multi-Chain Expansion","severity":"low","sources":[{"credibility":2,"name":"Ondo US Dollar Yield - CoinGecko","type":"other","url":"https://www.coingecko.com/en/coins/ondo-us-dollar-yield"},{"credibility":1,"name":"Ondo Finance Surpasses $1 Billion in TVL - Ondo Finance Blog","type":"official","url":"https://ondo.finance/blog/ondo-finance-surpasses-1-billion-in-tvl-the-future-of-tokenized-finance"},{"credibility":2,"name":"Ondo USDY: Tokenized Treasuries Explained - Eco Support","type":"other","url":"https://eco.com/support/en/articles/14798657-ondo-usdy-tokenized-treasuries-explained"},{"credibility":2,"name":"RWA.xyz Ondo U.S. Dollar Yield Asset Page","type":"research","url":"https://app.rwa.xyz/assets/USDY"}]}],"sources_used":[{"credibility":1,"name":"Introducing Ondo USD Yield (USDY) - Ondo Finance Blog","type":"official","url":"https://ondo.finance/blog/introducing-ondo-usd-yield-usdy"},{"credibility":1,"name":"USDY Basics - Ondo Finance Documentation","type":"official","url":"https://docs.ondo.finance/general-access-products/usdy/basics"},{"credibility":1,"name":"Ondo USDY LLC Eligibility - Ondo Finance Docs","type":"official","url":"https://docs.ondo.finance/general-access-products/usdy/faq/eligibility"},{"credibility":1,"name":"Onboarding and KYC FAQ - Ondo Finance Docs","type":"official","url":"https://docs.ondo.finance/general-access-products/usdy/faq/onboarding-and-kyc"},{"credibility":1,"name":"Trust and Transparency FAQ - Ondo Finance Docs","type":"official","url":"https://docs.ondo.finance/general-access-products/usdy/faq/trust-and-transparency"},{"credibility":1,"name":"Smart Contract Audits - Ondo Finance Docs","type":"official","url":"https://docs.ondo.finance/audits"},{"credibility":1,"name":"RWA Tokenization News: SEC Ends Probe into Ondo - CoinDesk","type":"news_article","url":"https://www.coindesk.com/markets/2025/12/08/ondo-token-gains-as-sec-ends-investigation-into-rwa-tokenization-platform"},{"credibility":1,"name":"Ondo Finance Written Input to SEC CTF - April 2026","type":"regulatory","url":"https://www.sec.gov/files/ctf-written-input-ondo-finance-041326.pdf"},{"credibility":1,"name":"Ondo Finance Written Input to SEC CTF - December 2025","type":"regulatory","url":"https://www.sec.gov/files/ctf-written-input-ondo-finance-120425.pdf"},{"credibility":2,"name":"SEC Drops Biden-Era Investigation Into Ondo Finance - Unchained Crypto","type":"news_article","url":"https://unchainedcrypto.com/sec-drops-biden-era-investigation-into-ondo-finance/"},{"credibility":2,"name":"High Risk Vulnerability Disclosed to Ondo Finance - iosiro","type":"research","url":"https://www.iosiro.com/blog/high-risk-vulnerability-disclosed-to-ondo-finance"},{"credibility":2,"name":"Asset Overview: U.S. Dollar token (USDY) - LlamaRisk","type":"research","url":"https://llamarisk.com/research/archive-llamarisk-asset-overview-u-s-dollar-token-usdy"},{"credibility":2,"name":"Ondo USDY: Tokenized Treasuries Explained - Eco Support","type":"other","url":"https://eco.com/support/en/articles/14798657-ondo-usdy-tokenized-treasuries-explained"},{"credibility":1,"name":"Ondo Finance Surpasses $1 Billion in TVL - Ondo Finance Blog","type":"official","url":"https://ondo.finance/blog/ondo-finance-surpasses-1-billion-in-tvl-the-future-of-tokenized-finance"},{"credibility":2,"name":"Ondo US Dollar Yield - CoinGecko","type":"other","url":"https://www.coingecko.com/en/coins/ondo-us-dollar-yield"},{"credibility":2,"name":"RWA.xyz Ondo U.S. Dollar Yield Asset Page","type":"research","url":"https://app.rwa.xyz/assets/USDY"},{"credibility":2,"name":"Ondo Finance Bug Bounties - Immunefi","type":"other","url":"https://immunefi.com/bug-bounty/ondofinance/"},{"credibility":2,"name":"Risks of Yield-Bearing Stablecoins 2026 - Eco Support","type":"other","url":"https://eco.com/support/en/articles/15253999-risks-of-yield-bearing-stablecoins-2026-depeg-smart-contract-counterparty"},{"credibility":2,"name":"What is Ondo US Dollar Yield (USDY) and how does it work - Bybit Learn","type":"other","url":"https://learn.bybit.com/en/stablecoin/what-is-ondo-us-dollar-yield-usdy"}],"summary":"Ondo US Dollar Yield (USDY) is a tokenized yield-bearing note issued by Ondo USDY LLC, a Delaware bankruptcy-remote special purpose vehicle affiliated with Ondo Finance, and backed by short-duration U.S. Treasuries, iShares Short Treasury Bond ETF shares, and bank demand deposits. The token is offered exclusively to non-U.S. persons under a Regulation S exemption, accrues yield through a rising token price or daily rebasing, and had grown to approximately $740 million in supply across ten blockchains as of early 2026. A two-year SEC investigation into Ondo Finance was closed without charges in December 2025, though ongoing risks include centralized price-setting infrastructure, limited FDIC deposit coverage on a portion of reserves, and access and composability constraints imposed by the token's on-chain allowlist system.","timeline":[{"date":"2023-08-03","event":"Ondo Finance announces the launch of USD Yield (USDY) on Ethereum as a tokenized note secured by U.S. Treasuries and bank deposits, offering 5% APY to non-U.S. investors.","source":"Ondo Finance Blog","source_url":"https://ondo.finance/blog/introducing-ondo-usd-yield-usdy"},{"date":"2023-10-01","event":"SEC initiates a confidential investigation into Ondo Finance, examining whether its tokenized real-world asset products and the ONDO token comply with federal securities laws.","source":"CoinDesk","source_url":"https://www.coindesk.com/markets/2025/12/08/ondo-token-gains-as-sec-ends-investigation-into-rwa-tokenization-platform"},{"date":"2024-02-01","event":"Ondo Finance expands USDY to Solana, with Solana eventually hosting approximately 35% of total USDY float.","source":"Invezz","source_url":"https://invezz.com/news/2024/02/22/ondo-finance-brings-tokenized-treasuries-to-aptos/"},{"date":"2024-04-01","event":"Code4rena and Cyfrin complete independent smart contract audits of the USDY Ethereum contract suite.","source":"Ondo Finance Documentation","source_url":"https://docs.ondo.finance/audits"},{"date":"2024-06-01","event":"Halborn completes the first of two security audits for USDY's Noble (Cosmos) blockchain deployment.","source":"Ondo Finance Documentation","source_url":"https://docs.ondo.finance/audits"},{"date":"2025-02-01","event":"Halborn completes a security audit of the USDY Ethereum contracts.","source":"Ondo Finance Documentation","source_url":"https://docs.ondo.finance/audits"},{"date":"2025-03-01","event":"USDY total supply surpasses $1 billion in TVL, a significant adoption milestone for tokenized U.S. Treasuries.","source":"Ondo Finance Blog","source_url":"https://ondo.finance/blog/ondo-finance-surpasses-1-billion-in-tvl-the-future-of-tokenized-finance"},{"date":"2025-03-01","event":"Spearbit completes a security audit of the USDY Ethereum contracts.","source":"Ondo Finance Documentation","source_url":"https://docs.ondo.finance/audits"},{"date":"2025-12-08","event":"The SEC formally closes its two-year investigation into Ondo Finance without filing charges, finding no enforcement action warranted. ONDO token gains approximately 6% on the news.","source":"CoinDesk","source_url":"https://www.coindesk.com/markets/2025/12/08/ondo-token-gains-as-sec-ends-investigation-into-rwa-tokenization-platform"},{"date":"2025-12-04","event":"Ondo Finance submits a letter to SEC Chair Paul Atkins and the Crypto Task Force outlining models for onchain migration of securities markets.","source":"U.S. Securities and Exchange Commission","source_url":"https://www.sec.gov/files/ctf-written-input-ondo-finance-120425.pdf"},{"date":"2025-12-15","event":"Ondo USDY LLC is folded into the Ondo Stocks product umbrella, though USDY continues operating under its existing legal and structural framework.","source":"Eco Support - Ondo USDY Tokenized Treasuries Explained","source_url":"https://eco.com/support/en/articles/14798657-ondo-usdy-tokenized-treasuries-explained"},{"date":"2026-04-13","event":"Ondo Finance submits a second letter to SEC Director Jamie Selway and the Crypto Task Force detailing further proposals for securities tokenization.","source":"U.S. Securities and Exchange Commission","source_url":"https://www.sec.gov/files/ctf-written-input-ondo-finance-041326.pdf"}]},"v":1}

   Verify offline (run on your own machine)

   python -m src.verify_decision 46ee7fe0-aaf7-44e7-b1ef-ffac26a578bdcopy