Tokenised US Treasurys surge as onchain finance gains traction

Tokenised US Treasurys have recorded explosive growth, expanding roughly fiftyfold since early 2024 as institutional demand for onchain yield accelerates.

Data from Token Terminal shows the combined market capitalisation of tokenised US Treasury products has risen from under $200 million in January 2024 to nearly $7 billion in late 2025.

The surge highlights a broader shift by financial institutions towards blockchain-based representations of traditional assets.

At the centre of this growth is BlackRock’s USD Institutional Digital Liquidity Fund, widely viewed as the flagship product in the tokenised Treasury market.

The fund provides exposure to short-term US Treasurys while enabling daily yield accrual and onchain settlement.

Industry data indicates the BlackRock-backed product has accumulated close to $2 billion in assets under management.

Other major offerings include USD Coin Yield from Circle, US Treasury Bill Token from Superstate and Ondo Short-Term US Government Bond Fund from Ondo Finance.

These products provide regulated, tokenised access to US government debt through compliant fund structures.

Market participants say the rise of tokenised Treasurys reflects growing confidence in blockchain as financial infrastructure.

US Treasury bills are considered particularly suitable for tokenisation due to their low risk and predictable returns.

Combining government backing with blockchain settlement has positioned Treasury bills as a gateway asset for institutional decentralised finance.

Financial institutions are increasingly using tokenised government debt for settlement and margining purposes.

Onchain Treasurys allow firms to improve capital efficiency without sacrificing asset quality.

DBS, Southeast Asia’s largest bank by assets, has been an early mover in testing tokenised Treasury and money market funds.

The bank has piloted blockchain-based government securities for collateral management and settlement workflows.

Tokenised Treasurys have grown alongside other real-world asset categories within onchain finance.

RedStone data shows private credit remains the fastest-growing tokenised asset class due to higher yields.

Analysts say tokenised government debt could play a foundational role in the next phase of institutional DeFi adoption.