About Flux Finance
Building the Bridge Between DeFi and Real-World Assets
Flux Finance is a decentralized lending protocol that allows anyone to lend stablecoins and earn yield backed by tokenized US Treasuries — bringing institutional-grade finance on-chain.
Our Mission
Democratizing Access to Treasury Yields
Flux Finance was built on a simple premise: real-world asset yields should be accessible to everyone with an Ethereum wallet. By bridging tokenized US Treasuries into DeFi, Flux Finance opens the door to stable, reliable returns that were historically reserved for institutional investors.
Our mission is to provide a transparent, secure, and composable protocol where lenders earn meaningful yield and borrowers access liquidity against high-quality collateral.
Protocol Overview
How Flux Finance Works
At its core, Flux Finance is a fork of Compound v2 — one of the most battle-tested protocols in DeFi — enhanced with permissioning logic to support regulated, real-world asset collateral like OUSG.
Lenders supply stablecoins (USDC, USDT, DAI, FRAX) and receive fTokens representing their deposited assets plus accrued interest. Borrowers post OUSG as collateral to borrow stablecoins at competitive rates.
All protocol parameters — including interest rates, collateral factors, and supported assets — are governed by ONDO token holders through the Ondo DAO.
Supported Assets
OUSG: The Backbone of Flux Finance
The only collateral accepted on Flux Finance is OUSG, a tokenized US Treasury product from Ondo Finance. OUSG primarily invests in the BlackRock USD Institutional Digital Liquidity Fund (BUIDL), with the remainder allocated to BlackRock's FedFund (TFDXX), bank deposits, and stablecoins.
This makes OUSG one of the most transparent and well-backed tokenized real-world assets in DeFi — an ideal foundation for a lending protocol that prioritizes lender safety and capital preservation.
Stablecoin lenders on Flux Finance can supply USDC, USDT, DAI, and FRAX, immediately beginning to accrue interest upon deposit. Yields are derived from the borrowing activity of OUSG holders who need on-chain liquidity without selling their Treasury position.
Security
Security is the Foundation
Flux Finance is built on a philosophy that security comes first. The protocol's smart contracts are derived from Compound v2, which has been deployed and battle-tested since 2019 and secured billions of dollars of user funds without a critical exploit.
All protocol-specific changes — primarily related to permissioning and real-world asset integration — have been independently audited by leading security firms and researchers.
- 1 Trail of Bits Audit — One of the most respected security research firms in the industry reviewed Flux Finance's smart contracts for vulnerabilities, logic errors, and best practice violations.
- 2 OpenZeppelin Review — The creators of the industry-standard ERC-20 library audited the protocol's access control and permissioning modules.
- 3 Certora Formal Verification — Mathematical proofs were applied to critical contract invariants to ensure correct behavior under all possible conditions.
- 4 Code4rena Audit Contest — An open competitive audit on code4rena gave the broader security community the opportunity to find and report issues, with over 100 wardens reviewing the codebase.
- 5 $550,000 Bug Bounty on Immunefi — Flux Finance maintains one of the largest bug bounties in DeFi, incentivizing ongoing white-hat research into the live protocol.
Governance
The Ondo DAO: Community-Governed Protocol
Flux Finance is a fully decentralized protocol governed by ONDO token holders through the Ondo DAO. Any protocol participant can propose, debate, and vote on changes — from interest rate model adjustments to new asset listings.
The DAO uses an on-chain governance system built on Tally, providing a transparent record of all proposals and votes. Forum discussions on the Flux Finance community forum allow the community to debate and refine proposals before they go to a vote.
This structure ensures that no single party — including the original developers at Ondo Finance — can unilaterally change the protocol. The future of Flux Finance belongs to its community.
On-Chain Governance
All parameter changes and upgrades require a successful governance vote from ONDO token holders before being executed on-chain.
Community Forum
The Flux Finance community forum is where ideas are born. Proposals are discussed, refined, and shaped by the community before formal submission.
Transparent Voting
All governance activity is publicly recorded on Tally, giving anyone the ability to inspect the full history of protocol decisions.
ONDO Token
The ONDO governance token grants holders the right to vote on protocol upgrades, risk parameters, and new asset integrations.
Time-Locked Execution
Approved governance proposals are subject to a timelock period, giving users time to review changes and take action if needed before they go live.
Open Participation
Anyone holding ONDO tokens can participate in governance, submit proposals, and vote — making Flux Finance a truly community-owned protocol.
fTokens
Composable Yield-Bearing Tokens
When you lend on Flux Finance, you receive fTokens — ERC-20 tokens representing your deposit plus accrued interest. fTokens are fully composable: they can be transferred, used as collateral in other protocols, or integrated into yield strategies.
Projects like Reserve and Yearn Finance have already integrated Flux Finance's fTokens, demonstrating the growing ecosystem being built on top of the protocol.
Ecosystem Integrations
Built for the Broader DeFi Ecosystem
Flux Finance is designed to be a foundational layer that other protocols can build upon. The fToken standard allows DeFi projects to integrate Flux Finance yield in their own products seamlessly.
Supported access methods include MetaMask, Coinbase Wallet, Ledger, Fireblocks (for institutions), and Gnosis Safe (for DAO treasuries), ensuring Flux Finance is accessible to every type of participant.