The rapidly evolving market for tokenized U.S. Treasuries has just welcomed its new frontrunner.
Circle (CRCL), primarily recognized for issuing the USDC (USDC) stablecoin, has emerged as the leading provider of tokenized Treasury exposure, with its USYC token witnessing remarkable growth to reach approximately $2.2 billion in supply, as highlighted by RWA.xyz.
This surge has allowed USYC to surpass BlackRock’s USD Institutional Digital Liquidity Fund (BUIDL), which, issued in collaboration with tokenization expert Securitize, currently holds around $2 billion in assets. BUIDL has seen its market share diminish from a peak of 46% in May, now standing at just 18%, amid increasing competition and new market entrants.
Tokenized real-world assets, including U.S. Treasury bills and money-market funds, are capturing the attention of both crypto traders and institutional investors. These assets are not only serving as yield-generating collateral but also as a strategic mechanism to park on-chain cash. Unlike traditional financial systems, blockchain-based tokens offer benefits such as near-instant settlement, transparent reserves, and 24/7 accessibility.
Additionally, Treasury-backed tokens provide investors with the opportunity to earn interest while leveraging these assets as collateral in trading activities, potentially enhancing capital efficiency compared to simply holding stablecoins or cash.
Circle’s entrance into the tokenized fund arena followed its acquisition of Hashnote, the entity behind USYC, in early 2025.
As of the latest reports, Securitize, the issuer for BUIDL, has not responded to requests for comment.
A Thriving Market
Upon closer examination of the data, it’s clear that much of USYC’s recent growth correlates with increased activity on the BNB Chain. Notably, cryptocurrency exchange behemoth Binance has adopted the USYC token as an off-exchange collateral option for institutional derivatives trading.
In this innovative structure, USYC can be secured with partner banks through the Binance Banking Triparty system or through Ceffu, Binance’s institutional-grade custody platform.
Since its launch in July, the USYC’s supply on the BNB Blockchain has skyrocketed to $1.84 billion, showcasing its rapid adoption.
“Tokenized treasuries and repos as collateral represent a significant emerging use case, and we are pleased with the speed of this growth,” stated Circle CEO Jeremy Allaire in a recent post on X.
The overall tokenized Treasury market is also on an upward trajectory, having recently set a new record, surpassing $11 billion, according to RWA.xyz data. The sector has witnessed a remarkable increase of approximately $2.5 billion in market capitalization, which represents a 27% growth since the beginning of the year.
This growth has accelerated, even during market downturns in January, indicating that some investors are strategically placing their capital in tokenized Treasuries to accrue steady yields while positioning themselves for future opportunities in digital assets.
