Blockchain-based US Treasuries are on the rise, with their total value edging closer to a new all-time high of $6 billion. These digital financial instruments, which mirror traditional government bonds but exist on-chain, provide investors with yield-bearing exposure along with the benefits of blockchain technology.
Data from real-world asset platform RWA.xyz shows that tokenized treasuries on public blockchains were valued at $4.01 billion in January. Since then, the figure has surged by over 43% to nearly $5.95 billion.
This significant increase indicates a growing institutional trust in blockchain as a tool for modernizing fixed-income markets. Among the various blockchains hosting tokenized Treasuries, Ethereum leads the pack with $4.3 billion, followed by Stellar at $474 million and Solana at $273 million.
BlackRock’s USD Institutional Digital Liquidity Fund, known as BUIDL, has emerged as the dominant player in the market. With $2.47 billion in assets under management, BUIDL holds a 42% share of the total tokenized treasury space. Over the past month, BUIDL’s value has surged by 92%, showcasing its rapid adoption.
Ethereum remains the primary blockchain for BUIDL, holding over 91% of its supply, equivalent to around $2.3 billion. The remaining portion is distributed across newer blockchains and Ethereum Layer-2 networks like Arbitrum, Polygon, Optimism, Aptos, and Avalanche.
Launched in March 2024, BUIDL pays daily dividends generated from short-term US Treasury assets. Each BUIDL token is backed one-to-one with the US dollar, offering yield potential similar to Treasuries and functioning as a stablecoin.
The success of BlackRock’s BUIDL is indicative of a broader trend among financial institutions embracing tokenized real-world assets (RWAs). Analysts note that tokenized Treasuries serve as a bridge between traditional finance and decentralized ecosystems, prompting other major financial firms to enter the space.
For example, Franklin Templeton operates a competing tokenized fund with a market cap of $706 million, while Fidelity is gearing up to launch “OnChain,” a blockchain-powered version of its Treasury money market fund, after filing with the US Securities and Exchange Commission (SEC).
The increasing adoption of blockchain-based US Treasuries by institutional players underscores the growing mainstream acceptance of decentralized finance and the potential for blockchain technology to revolutionize the financial sector.