Tokenized Treasuries Surge 70% YTD Despite Crypto Market Weakness

The sector has grown from roughly $8.3bn in January to more than $14bn as of 7 May, according to RWA.xyz data. Much of the increase has been driven by a handful of large funds, including Circle’s USYC, BlackRock’s USD Institutional Digital Liquidity Fund (BUIDL), Franklin Templeton’s OnChain U.S. Government Money Fund, and Ondo’s U.S. Dollar Yield (USDY).

USYC has expanded to about $3bn from roughly $1.5bn at the start of the year, while BUIDL has grown to around $2.4bn from $1.7bn. Franklin Templeton’s fund has risen to $2.1bn from just under $1bn, and Ondo’s product climbed to $2.1bn from around $700mn over the same period.

Tokenized Treasuries lead RWAs

The gains highlight how tokenized Treasuries have become one of the fastest-growing segments of the real-world asset (RWA) market, which now totals about $31bn in distributed asset value, up from roughly $20bn at the start of the year.

"After a year of DeFi exploits and yields compressing across the major lending protocols, capital is rotating toward collateral that carries institutional brands and real underlying assets," said David Plisek, COO of DeFi protocol Solstice. "Tokenized treasuries check both boxes."

He added that tokenized Treasuries allow investors to earn yield while using the same assets as collateral in DeFi strategies. 

"A sophisticated user can hold BUIDL (earning T-bill yield), post it as collateral in a DeFi lending market, borrow against it, and deploy the borrowed capital into another yield strategy," Plisek said. 

Momentum is back

The growth also suggests capital has continued flowing into tokenized Treasuries even as the broader crypto market has lagged.

Bitcoin (BTC) is down about 8% year-to-date, but up 2.3% on the week, trading around $80,222 after a volatile start to 2026. Despite that, institutional demand for tokenized yield products has remained steady.

"The energy at the institutional level is at an all-time high, even if the market is down from its highs from late last year," Richard Green, director of Institutional and Ecosystem at RootstockLabs, a Bitcoin-focused network, told Sandmark. "This suggests to me that Bitcoin and other digital assets are beginning their rebound process before an inevitable ascent." 

He explained that new all-time highs this year are uncertain, but the market appears to have bottomed. Green added that the CLARITY Act before the US Congress could unlock significant capital inflows.

"Passage does seem to be increasingly likely, but if it doesn’t actually pass, the digital asset space has received such strong regulatory clarity from the SEC, CFTC and other agencies that momentum in this industry feels enduring," Green said.