DeFi
Tokenized US Treasuries Could Reach $3 Billion by Year-End, Says 21co Analyst
21co analyst Tom Wan believes tokenized US Treasuries will hit 3 billion dollars by the end of 2024, amid growing adoption among DeFi projects and decentralized autonomous organizations (DAOs).
According to Wan, the trend is driven by a need for diversification and stability, especially since high interest rates make these assets attractive.
Currently, over 15 tokenized US Treasury products are available on Ethereum Virtual Machine (EVM) chains, managing nearly $2 billion in assets under management (AUM).
Adoption on the rise
Wan said DeFi projects are increasingly diversifying their treasuries to incorporate tokenized U.S. Treasuries and stablecoins, signaling a major shift towards real-world assets (RWAs) within the crypto ecosystem.
Notable examples include Arbitrum and MakerDAO, which have allocated $27 million and $1 billion, respectively, to these yield-generating products. These investments are part of a broader strategy to provide risk-free returns without leaving the blockchain ecosystem, facilitated by financial giants like BlackRock and To secure.
BlackRock USDT’s institutional digital liquidity fund, known as BUIDL, recently became the largest tokenized treasury fund, surpassing Franklin Templeton BENJI Fund.
BUIDL’s market capitalization has climbed to nearly $500 million since its launch earlier this year, reflecting growing demand for these assets.
Ready for growth
The market for tokenized US Treasuries has seen explosive growth, with over $2 billion in assets tokenized on blockchains such as Ethereum, PolygonAnd Solana.
Wan said this growth is expected to continue, with projections indicating that the market capitalization of tokenized U.S. Treasuries could exceed $3 billion by the end of 2024.
The integration of tokenized US Treasuries into DeFi Treasuries represents a significant step forward in the convergence of traditional finance and blockchain technology. As more DAOs and DeFi projects adopt these products, the sector is poised for substantial growth, attracting investors seeking reliable returns in the volatile cryptocurrency market.
This trend highlights the potential for tokenization of real-world assets to transform the financial landscape, providing increased liquidity, faster transactions and lower fees. With leading financial institutions explore blockchain technologyThe adoption of tokenized assets is set to reshape the future of finance.