W Power 2024

US Treasury tokens surpass $1 billion on blockchain

This achievement has been facilitated, in part, by the recent debut of the BlackRock USD Institutional Digital Liquidity Fund

Shashank Bhardwaj
Published: Mar 28, 2024 04:11:44 PM IST

US Treasury tokens surpass <img billion on blockchain

Across Ethereum, Polygon, Solana, and various other blockchains, more than $1 billion worth of United States Treasuries are now digitised. This achievement comes on the heels of BlackRock's introduction of its inaugural tokenised asset fund, BUIDL, which recently joined 16 other similar funds focused on government securities.

BlackRock's offering, identified as "BUIDL," was introduced on Ethereum on March 20 and currently holds a market capitalisation of $244.8 million. Etherscan data indicates that four transactions totaling $95 million were made to the fund over the past week, bolstering its position as the second-largest tokenised government securities fund.
BUIDL, in second place, trails behind Franklin Templeton's Franklin OnChain U.S. Government Money Fund (FOBXX), which has $360.2 million in U.S. Treasuries.
Ondo Finance, a real-world asset tokenisation firm, recently deposited $79.3 million into BlackRock's fund. This transaction facilitates instant settlements for Ondo Finance's own U.S. Treasury-backed token, OUSG. Ondo Finance made a total of $95 million in deposits across four transactions.
As a result of these deposits, Ondo Finance now holds a 38% share in BUIDL.
BUIDL's value is tied 1:1 with the United States Dollar and distributes daily accrued dividends directly to investors on a monthly basis. It was introduced on Ethereum through the Securitize protocol.

Tokenised government treasuries are deemed more attractive in terms of both risk and return compared to stablecoin yields, particularly in the current high-interest rate environment.

BlackRock CEO Larry Fink recently emphasised the potential for blockchain tokenisation to enhance efficiency in capital markets.

While U.S. Treasuries represent a significant portion of tokenised assets, it's essential to recognise that stocks, real estate, and various other assets can also undergo tokenisation. In terms of Ethereum, approximately $700 million worth of real-world assets (RWA) have been tokenised on-chain.

Franklin Templeton's FOBXX is tokenised on platforms like Stellar and Polygon. These platforms hold the second and third largest market shares of tokenised products, totaling $358 million and $13 million, respectively.

WisdomTree, an asset management firm, is also engaged in tokenising real-world assets (RWAs). Additionally, several blockchain-native firms, including Ondo Finance, Backed Finance, Matrixdock, Maple Finance, and Swarm, are actively involved in this space.
The tokenisation of over $1 billion worth of US Treasuries signifies a monumental shift in asset management, driven by blockchain technology. This milestone underscores the growing prominence of tokenised assets across various blockchains. As traditional finance converges with blockchain innovation, the market for tokenised assets is poised for exponential growth, with projections indicating a $16 trillion market by 2030.

Shashank is the founder of yMedia. He ventured into crypto in 2013 and is an ETH maximalist.
Twitter: @bhardwajshash

Post Your Comment
Required, will not be published
All comments are moderated
DevRev's effortless conference: Pioneering AI's role in shaping a $10 trillion Indian economy
Photo of the day: Offering a chance to survive