Tokenized US Treasurys have emerged as one of the fastest-growing segments of the real-world asset (RWA) market, with data pointing to 50x growth in less than two years amid rising institutional demand for on-chain yield.
Data from Token Terminal shows that the combined market capitalization of tokenized US Treasury products has exploded from well under $200 million in January 2024 to almost $7 billion in late 2025. The growth underscores the rapid acceleration of onchain adoption for government-backed debt instruments.
Source: Token Terminal
At the center of this expansion is BlackRock’s USD Institutional Digital Liquidity Fund (BUIDL), which is widely regarded as the flagship product of the tokenized Treasury market.
The blockchain-based fund provides investors with exposure to short-term US Treasurys while offering daily yield accrual and onchain settlement. Industry data shows that BUIDL has amassed close to $2 billion in assets under management.
Other prominent offerings include USD Coin Yield (USYC) from Circle, US Treasury Bill Token (USTB) from Superstate and Ondo Short-Term US Government Bond Fund (OUSG) from Ondo Finance.
Each product offers tokenized access to US government debt through regulated fund structures, reflecting a broader push to bring traditional fixed-income instruments onto blockchain rails.
Related: Goldman Sachs, BNY to offer tokenized money market funds for clients
Tokenized Treasury bills emerge as a key gateway to institutional DeFi
US Treasury bills are particularly well-suited for tokenization, as they combine the safety of US government backing with the efficiency of blockchain-based settlement, creating a regulated gateway into decentralized finance (DeFi) markets.
As Cointelegraph has reported, institutional adoption of tokenized Treasury bills is gaining traction, particularly for use in settlement and margining. Traditional financial institutions are using tokenized government debt to improve capital efficiency while maintaining exposure to low-risk assets.
DBS, Southeast Asia’s largest financial institution by assets, was among the first major lenders to test tokenized funds, including blockchain-based Treasury products. The bank has piloted tokenized money market funds and government securities as part of broader efforts to use onchain assets for collateral management and settlement.
Tokenized Treasury bills have grown in tandem with other onchain assets, contributing to the rapid evolution of the tokenization market. RedStone data shows that private credit has been the fastest-growing segment, buoyed by yields that exceed those of traditional investment vehicles.
Related: New protocol targets redemption delays in $20B tokenized market
