Tokenized U.S. Treasuries have surged past the $4 billion mark, growing by $1.57 billion in just 103 days. This rapid expansion signals increasing institutional interest in blockchain-based financial instruments tied to government debt.
Data from rwa.xyz confirms the sector’s total valuation now stands at $4.07 billion, with Hashnote’s Short Duration Yield Coin (USYC) leading the charge.
USYC, which blends short-term Treasury holdings with reverse repo agreements, nearly doubled its market cap during this period. The fund rose from $495.07 million on Nov. 26, 2024, to $956.27 million today, an increase of $461.2 million.
Global investors can access the fund through the Hashnote International Feeder Fund or the Short Duration Yield Fund (SDYF), provided they meet a minimum investment requirement of $100,000.
U.S.-based investors must qualify under Commodity Futures Trading Commission (CFTC) rules as Qualified Eligible Participants (QEPs) to invest in USYC via the Hashnote Feeder Fund. Hashnote’s regulatory framework ensures compliance, while its operational structure enables same-day (T+0) or next-day (T+1) liquidity in USDC or PYUSD.
Franklin Templeton and BlackRock Compete for Market Share
Franklin Templeton’s Franklin Onchain U.S. Government Money Fund, also known as FOBXX or BENJI, has seen significant growth. The fund expanded by $270.35 million since Nov. 26, reaching a current market capitalization of $686.80 million.
BENJI is available to institutional investors in Austria, France, Germany, Italy, Liechtenstein, the Netherlands, Spain, and Switzerland, as well as via Franklin Templeton’s Institutional Web Portal.
BlackRock’s tokenized offering, the BlackRock USD Institutional Digital Liquidity Fund (BUIDL), trails closely behind. Initially the largest player in the space, with a market capitalization of $530.29 million, BUIDL has grown to $668.41 million, now ranking third.
The fund, distributed through Securitize, caters exclusively to institutional investors such as hedge funds, asset managers, and multinational firms. A $5 million minimum investment threshold underscores its focus on high-net-worth clients.
Market Distribution and Yield Potential
Together, USYC, FOBXX, and BUIDL account for 56.78% of the $4.07 billion tokenized Treasuries market. Other notable funds include Ondo’s USDY ($592 million) and OUSG ($408 million), Superstate’s USTB ($328 million), Wisdomtree’s WTGXX ($112 million), and Openeden’s TBILL ($96.54 million).
These offerings provide investors with an average annual percentage yield (APY) of 4.2%, according to rwa.xyz. The number of holders in the market has nearly doubled in just over three months, climbing from 8,754 to 15,463. This rapid adoption indicates a shift from a niche financial product to a mainstream investment vehicle.
Understanding Tokenized Treasury Bills
Tokenized Treasury Bills (T-Bills) are digital representations of U.S. government debt issued on a blockchain. Unlike traditional securities, tokenized T-Bills offer increased accessibility, automated trading strategies, and enhanced liquidity. Investors receive the full face value at maturity, with the purchase price fluctuating based on interest rates and time to maturity.
T-Bills typically have maturities ranging from four to 52 weeks and do not pay regular dividends. Instead, they are sold at a discount, with the yield determined by the difference between the purchase price and face value.
The yield is influenced by factors such as Federal Reserve policy, interest rate fluctuations, and overall market demand.
Tokenization allows for fractional ownership and global access to U.S. Treasuries, reducing the barriers traditionally faced by international investors.
Firms issuing these digital assets purchase Treasury Bills and hold them in reserve while issuing tokens that represent a stake in the underlying pool.
Hashnote’s model integrates blockchain technology to provide real-time transparency, security, and composability. Investors benefit from segregated custodial accounts, regulatory oversight from the CFTC and the Cayman Islands Monetary Authority (CIMA), and access to direct redemption mechanisms. Hashnote’s ERC-20 token structure also enables seamless on-chain transactions.
