Tokenized Treasury Assets Surge to $4.2B, Hitting New Peak as Investors Seek Stability

Tokenized Treasury Market Hits $4.2B as Crypto Investors Shift to Safer Assets

Ondo Finance, BlackRock-Securitize, and Superstate led market gains, while Hashnote’s USYC declined amid DeFi turbulence.

Amid ongoing volatility in the crypto market, investors have increasingly turned to tokenized U.S. Treasuries as a stable alternative, pushing their total market capitalization to a record $4.2 billion, according to rwa.xyz data.

Since late January, the market for tokenized Treasury products has expanded by $800 million, reflecting a growing demand for lower-risk, yield-bearing assets during the broader crypto downturn.

Leading the surge, Ondo Finance’s (ONDO) OUSG and USDY tokens collectively grew by 53%, nearing the $1 billion mark. BlackRock and Securitize’s BUIDL token also saw strong momentum, climbing 25% to exceed $800 million. Additionally, Franklin Templeton’s BENJI token increased 16% to $687 million, while Superstate’s USTB experienced a sharp 63% rise, reaching $363 million.

However, not all issuers benefited from the trend. Hashnote’s USYC token saw a significant decline, shedding over 20% of its market capitalization and falling to $900 million. The drop was largely attributed to turmoil within DeFi protocol Usual, whose USD0 stablecoin—backed primarily by USYC—saw its total supply plummet from $1.8 billion in January to under $1 billion.

“The growing appeal of tokenized treasuries during this market correction mirrors traditional finance trends, where investors pivot to U.S. government bonds during periods of uncertainty,” said Brian Choe, head of research at rwa.xyz, in a statement to CoinDesk.

Choe noted that during the bullish phase between November and January, stablecoins outpaced Treasuries in growth. However, as market conditions worsened in February, Treasury-backed tokens gained traction, suggesting that investors are staying in the crypto ecosystem but reallocating funds to more stable, yield-generating options.

“This shift indicates that rather than exiting crypto entirely, investors are temporarily rotating capital into safer assets until sentiment improves,” Choe added.

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