What Are the Major Security Risks Facing Ondo Finance in 2025?

Smart contract vulnerabilities pose ongoing security risks

Ondo Finance's smart contract security has undergone rigorous evaluation through multiple professional audits. According to a comprehensive security review, distribution status showed 7 fixed issues, 4 acknowledged concerns, and notably zero unresolved vulnerabilities. Recent technical assessments confirm no critical or high-severity risks remain active within the protocol's architecture.

The audit data reveals important security metrics:

While these results demonstrate strong security practices, the acknowledged issues include some medium-risk concerns such as rounding issues when calculating absolute changes in basis points. Other acknowledged items involve ownership transfer processes and oracle decimals verification. Ondo has implemented a bug bounty program through Immunefi with substantial rewards—offering up to 10% of affected funds (maximum $1,000,000) for critical vulnerabilities, further strengthening their security posture.

Security experts recommend continued vigilance through ongoing monitoring despite these positive audit outcomes. Smart contract security requires persistent attention as new attack vectors emerge in the rapidly evolving DeFi landscape.

RWA-related security incidents caused $14.6 million in losses in H1 2025

The first half of 2025 witnessed a concerning trend as security firms including CertiK tracked approximately $14.6 million in losses specifically related to Real-World Asset (RWA) exploits. This represents a significant shift in hacking tactics, as threat vectors have evolved from purely off-chain vulnerabilities to more sophisticated hybrid attacks targeting the entire RWA ecosystem.

Security experts have noted that RWA tokenization introduces particularly complex security challenges since an RWA token's value is fundamentally a claim on an off-chain asset, expanding the attack surface beyond traditional smart contract code vulnerabilities.

The data reveals a troubling trend when comparing RWA exploits with broader crypto security incidents:

While RWA exploits currently represent a smaller percentage of overall crypto security incidents, security firms warn this category is becoming increasingly attractive to hackers. The Ethereum ecosystem has been particularly vulnerable, with Ethereum-related projects suffering approximately $38.6 million in losses across various attack vectors during this period. These findings underscore the critical importance of implementing comprehensive security measures that address both on-chain and off-chain vulnerabilities in RWA protocols.

Centralized dependencies like custodial services remain a concern

Despite Ondo Finance's innovative approach to bridging traditional finance with DeFi through tokenized assets, the platform faces significant risks related to its centralized infrastructure. Ondo relies on licensed custodians to hold the underlying Treasuries and money market funds, introducing dependency and counterparty risks that cannot be overlooked. These custodial services create potential vulnerabilities in the protocol's operational framework.

The centralized nature of these custodial relationships exposes Ondo to regulatory scrutiny, as evidenced by the platform's need to comply with numerous financial regulations. According to documentation, Ondo must adhere to Bank Secrecy Act/anti-money laundering requirements, countering the financing of terrorism protocols, and Office of Foreign Assets Control mandates.

Market analysis reveals the significance of these concerns:

The reality is that while Ondo's underlying assets (primarily U.S. Treasuries) are considered safe, user access fundamentally depends on centralized entities, issuers, custodians, and smart contract integrity. This centralization stands in contrast to DeFi's core ethos of decentralization and trustlessness, representing a tradeoff between traditional financial security and true blockchain autonomy.

FAQ

Can ondo reach $10?

Yes, Ondo could potentially reach $10 by 2030, driven by growth in DeFi and RWA markets. This projection depends on Ondo's continued innovation and favorable market conditions.

Does ondo crypto have a future?

Ondo crypto's future looks promising. As the DeFi sector grows, Ondo's innovative financial products could gain traction, potentially increasing its value and adoption in the coming years.

What is the ondo coin?

Ondo coin is a digital asset in the DeFi ecosystem, powering a protocol that tokenizes real-world assets. It bridges traditional finance with blockchain, offering accessible financial products.

Is ondo backed by BlackRock?

Yes, Ondo is backed by BlackRock. BlackRock is the largest holder of Ondo's OUSG, and Ondo aims to diversify its reserves through this partnership.