USO vs OIL(USOON): What’s the Difference Between the United States Oil Fund and Tokenized USO?

Summary

USO and OIL(USOON) are economically connected but structurally different products.

USO, or the United States Oil Fund, LP, is an exchange-traded commodity pool whose shares trade on NYSE Arca. It primarily uses crude-oil futures and related instruments to seek daily exposure related to light sweet crude oil prices.

OIL(USOON) is an Ondo tokenized product linked to USO and traded against USDT on MEXC.

The relationship is:

WTI

↓

WTI futures

↓

USO

↓

Ondo USOon

↓

MEXC OIL(USOON)/USDT

The key difference is:

USO is the underlying exchange-traded commodity product. OIL(USOON) is a separate tokenized instrument designed to provide economic exposure linked to USO.

USO vs OIL(USOON) at a Glance

What Is USO?

USO is formally the United States Oil Fund, LP.

USCF describes it as an exchange-traded security designed to track daily price movements of light sweet crude oil through a specified short-term futures benchmark. It currently invests in oil futures and may also use swaps and other oil-related investments.

For a complete explanation, see:

What Is USO? United States Oil Fund, WTI Futures, Roll Strategy, Contango and Risks Explained.

What Is OIL(USOON)?

OIL(USOON) adds a tokenization layer on top of USO.

It should therefore not be described as:

• Physical oil;
• A barrel of WTI;
• A WTI futures contract;
• Direct USO ownership.

For the full product structure, see:

What Is OIL(USOON)? Ondo Tokenized United States Oil Fund Explained.

Does OIL(USOON) Give Direct Ownership of USO?

No.

A conventional USO investor owns shares of the exchange-traded commodity pool through securities-market infrastructure.

An OIL(USOON) holder owns the tokenized instrument.

Although the token is structured to provide economic exposure linked to USO, the legal form and custody chain are different.

Do Either USO or OIL(USOON) Own Physical Oil for the Investor?

No.

This is one similarity.

USO primarily uses futures and related financial instruments rather than buying physical crude and allocating barrels to shareholders.

OIL(USOON) then tracks the economic exposure of USO.

Therefore neither product gives an ordinary holder the right to go to Cushing and request delivery of barrels of crude.

USO vs OIL(USOON): Where Does WTI Enter the Structure?

WTI enters at the futures layer.

USO's Benchmark Oil Futures Contract is tied to light, sweet crude delivered to Cushing, Oklahoma.

CME describes WTI futures as physically delivered contracts whose delivery point is Cushing, a major U.S. crude-storage and pipeline hub.

But OIL(USOON) does not directly own that futures contract.

USO vs OIL(USOON): Trading Hours

USO's principal trading takes place on NYSE Arca.

Tokenized markets can operate outside ordinary U.S. equity-market hours.

This means a situation can occur where:

USO's most recent market price is stale

while:

oil futures and OIL(USOON) are responding to new information.

That can produce a temporary numerical difference without necessarily indicating that the token structure has failed.

USO vs OIL(USOON): Quote Currency

USO trades in:

USD

MEXC trades:

OIL(USOON)/USDT

Therefore the tokenized market adds another variable:

USDT/USD

Even relatively small deviations can affect exact numerical comparisons.

USO vs OIL(USOON): Liquidity

USO and OIL(USOON) have separate markets.

USO liquidity does not automatically become identical OIL(USOON) liquidity.

The token market can have different:

• Bid-ask spreads;
• Market makers;
• Order-book depth;
• trading demand.

For the live MEXC market:

OIL(USOON)/USDT Spot.

Both Products Inherit Futures Roll Risk

USO directly carries futures-roll effects.

OIL(USOON) indirectly inherits them because its underlying reference is USO.

USO's current benchmark transitions from the near-month WTI contract to the next-month contract during a five-day roll period.

Therefore:

Tokenization does not remove contango or backwardation.

What Happens in Contango?

In contango:

near-month futures < later futures

For example:

September WTI: $80

October WTI: $83

Repeatedly moving exposure into more expensive later contracts can create unfavorable futures-curve effects.

That can cause USO to perform differently from a simplistic spot-oil comparison.

What Happens in Backwardation?

In backwardation:

near-month futures > later futures

For example:

September WTI: $85

October WTI: $82

The roll environment can be more supportive.

But neither structure guarantees profit because the entire futures curve continues moving.

How Is RealStocks Different?

MEXC's RealStocks is another important comparison.

MEXC describes RealStocks as a product developed with regulated brokers that allows eligible users to directly purchase real publicly listed U.S. shares, hold the corresponding stock assets and receive associated shareholder rights.

That is materially different from an Ondo tokenized product.

For more information:

What Is RealStocks?

The availability of USO itself through RealStocks should be verified through the live RealStocks market rather than assumed.

USO vs OIL(USOON): Which Is Better?

There is no universally superior product.

The more useful question is:

Which structure matches the user's access requirements, preferred market infrastructure and risk tolerance?

A traditional USO position may appeal to users who prefer conventional securities-market infrastructure.

OIL(USOON) may appeal to eligible crypto-market participants who want tokenized economic exposure and USDT-based trading.

The latter adds additional tokenization and exchange risks.

FAQ

Is OIL(USOON) the same as USO?

No. USO is the underlying commodity pool security; OIL(USOON) is a separate tokenized product linked to it.

Do both track WTI perfectly?

No. USO uses futures, and OIL(USOON) adds another tracking layer.

Does either product give me physical oil?

No.

Does OIL(USOON) give me direct USO shares?

No.

Can OIL(USOON) trade differently from USO?

Yes, particularly when traditional markets are closed or token liquidity differs.

Where can I buy OIL(USOON)?

See:

How to Buy OIL(USOON) on MEXC.

Risk Disclaimer

USO and OIL(USOON) are different legal and operational products. Both are exposed to crude-oil and futures-market risks, while OIL(USOON) adds issuer, backing, token tracking, blockchain, USDT, liquidity and centralized-exchange custody risks.