The tokenization of United States Treasurys and other real-world assets on blockchain platforms has gained significant traction, with over $1 billion worth of U.S. Treasurys now existing across Ethereum, Polygon, Solana, and other blockchains. This surge has been fueled in part by the launch of the BlackRock USD Institutional Digital Liquidity Fund (BUIDL), which has quickly become a prominent player in the market.
United States tokenized treasury asset hits a milestone figure
BUIDL, launched on Ethereum on March 20, has rapidly grown to a market cap of $244.8 million. Recent transactions totaling $95 million have further boosted the fund, making it the second largest tokenized government securities fund, trailing only Franklin Templeton’s Franklin OnChain U.S. Government Money Fund (FOBXX), which holds $360.2 million in United States Treasurys.
The appeal of tokenized government treasures lies in their 1:1 peg with the United States dollar and the daily accrued dividends they pay directly to investors each month. This model, facilitated via the Securitize protocol, is seen as more attractive from both a risk and return perspective compared to stablecoin yields, particularly in the current high-interest rate environment.
Real-world asset tokenization firms like Ondo Finance have also contributed significantly to BUIDL’s growth. Ondo Finance recently deposited $79.3 million into BlackRock’s fund, totaling $95 million across four transactions. This move allows instant settlements for Ondo Finance’s own U.S. Treasury-backed token, OUSG, and has earned the firm a 38% share in BUIDL.
Growing trends and the impact of tokenized assets
The broader landscape of tokenized assets includes not just U.S. Treasurys but also stocks, real estate, and various other assets that can be tokenized on blockchain platforms. Ethereum, for instance, accounts for $700 million of all real-world assets (RWA) tokenized on-chain, highlighting the platform’s significance in this space.
BlackRock CEO Larry Fink’s support for blockchain tokenization reflects a broader trend in the financial industry, with Boston Consulting Group estimating that the tokenization market could reach $16 trillion by 2030. This trend is not limited to traditional asset management firms like BlackRock and Franklin Templeton.
Blockchain-native firms such as Ondo Finance, Backed Finance, Matrixdock, Maple Finance, and Swarm are also active participants in tokenizing real-world assets. Overall, the rapid growth of tokenized U.S. Treasurys and other assets on blockchain platforms underscores the increasing acceptance and adoption of blockchain technology in the financial sector, paving the way for more efficient and accessible capital markets in the future.
