Tokenized Treasuries: How Onchain T-Bills Work

A tokenized treasury is a share in a fund holding short-dated US government debt, recorded as a transferable token on a public blockchain rather than only in a transfer agent’s book-entry ledger. The paper does not move onchain; it sits in a custody account at a bank, where it sat before.

As of 2026-08-03, rwa.xyz counts $16.16B in its “tokenized US Treasury funds” category — smaller than most headlines, because most headlines count something wider. Below: the mechanism, what we can verify about the products on our RWA Yield Board, and what nobody publishes at all.

What are tokenized treasuries and how do they work?

Four layers stack up, and only the top one is new.

• The portfolio. A fund or special-purpose vehicle buys US Treasury securities and holds them at a custodian bank: BUIDL custodies at BNY Mellon, which also administers it, and PricewaterhouseCoopers audits it.
• The legal wrapper. Per its Form D/A of 2026-07-27, BUIDL is a British Virgin Islands company sold under Rule 506(c) and relying on the Section 3(c)(7) exclusion, not a fund registered under the Investment Company Act. The wrapper holds most of the difference between products.
• The register. A transfer agent records who owns what. Securitize is transfer agent for BUIDL and VanEck’s VBILL; Superstate Services keeps the register for USTB.
• The token. That register entry is issued on Ethereum and other chains, transferable only between whitelisted wallets.

The payout mechanic matters. BUIDL’s net asset value is fixed at $1.00 and dividends accrue daily, paid monthly as newly minted tokens rather than as a rising price. A price-change calculation cannot read that, which is why rwa.xyz showed a 7-day APY of 1.47% and a 30-day APY of 0.34% for BUIDL on 2026-08-03 — implausible for a Treasury portfolio. Neither BlackRock nor Securitize publishes a yield at all.

Not every product here is a fund: Ondo’s USDY is a tokenized note, debt of a bankruptcy-remote BVI vehicle rather than a claim on a segregated portfolio. Its issuer changed from Ondo USDY LLC (Delaware) to Ondo Global Markets (BVI) Limited on 2025-12-15; most third-party write-ups still name the Delaware entity, and Ondo’s own marketing page still shows a United States issuer domicile.

Benefits of tokenizing US Treasury bills

• Transfer outside banking hours. OUSG mints and redeems atomically 24/7/365 on Ethereum mainnet; USYC redeems into USDC at T+0. Traditional settlement times run on business days.
• Use as collateral. A whitelisted token can be pledged in onchain lending markets while it accrues Treasury yield, which a book-entry share cannot do.
• Smaller tickets, in some wrappers. Spiko’s USTBL takes $1, while BUIDL’s Form D states $100,000 against Securitize’s $5,000,000 — most likely a share-class difference.
• Countable supply. Anyone can check token supply against the chain, an audit surface book-entry registers do not offer.
• Cash management onchain. Treasurers holding stablecoins reach a yield-bearing digital asset without leaving the rail they settle on. See DeFi vs TradFi for where the two systems genuinely differ.

Risks and downsides of tokenization

Six failure surfaces, roughly in order of how often they are ignored.

• The wrapper, not the paper. Most vehicles are offshore and unregistered: BVI companies, a Cayman fund, a Delaware limited partnership issuing a Schedule K-1. Investor rights come from that structure, not from owning bills.
• Yields that are not comparable. Only some of these are US-registered money market funds filing under Rule 2a-7 and publishing a real 7-day SEC yield. The rest publish a computed APY, a 30-day yield, or nothing, which is why the metric belongs next to every number.
• Published figures that are wrong. Circle’s marketing page for USYC stated $312.9M while its own live API returned $3,007,906,817 the same day, understating its own product roughly tenfold. Ondo reports $378.35M for OUSG as of 2026-07-31; rwa.xyz showed $450.9M on 2026-08-03, a 19% gap neither explains.
• Restricted transferability. The token is only as liquid as the approved address set, and there is no open secondary market for most of these.
• Wrapper on wrapper. Theo’s thBILL is a fund of tokenized funds: $63.4M of ULTRA, a Singapore fund with Wellington Management as sub-adviser, plus $5.7M of USDC in Aave as of 2026-08-03. Two levels from the underlying asset, with a lending protocol in the path.
• A 24/7 token on a business-hours market. The bill market is not open when the token is, so instant redemption is a promise from the manager rather than a property of the paper.

Tokenized treasuries vs. traditional treasuries vs. money market funds

As of 2026-08-03. A tokenized fund is a wrapper choice, not a different T-bill.

Dimension	Tokenized treasury fund	Directly held T-bills	US money market fund
What you own	A share or note issued by an offshore or private vehicle	The government obligation itself	A registered fund share
Regime	Mostly Reg D or Reg S, unregistered; one EU UCITS in our set	Direct US Treasury obligation	Investment Company Act, Rule 2a-7
Yield metric	30-day APY, 30-day yield, or none published	Auction discount rate	7-day SEC yield, defined by rule
Minimum	$1 to $5,000,000, by wrapper	Retail denominations at auction	Set by the fund
Transfer	24/7 between whitelisted addresses	Business days, via a broker	None; subscribe and redeem
DeFi collateral	Yes, where a protocol has listed it	No	No
Who can buy	Usually accredited, qualified purchaser or non-US only	Public	Public

Against a money market fund, the tokenized version trades regulatory protection for settlement flexibility, and whether that is worth it depends on whether the buyer needs the token to do something onchain.

Who is leading the market

Tokenized treasury products, read 2026-08-03 unless dated otherwise. Yields carry their metric because they are not interchangeable.

Product	Assets	Yield (metric)	Wrapper / domicile	Eligibility	Custodian
USYC (Circle)	$3.01B	3.16% (30-day APY)	Registered mutual fund, Cayman; token issuer Bermuda	Institutional, non-US	Marex, prime broker
BUIDL (BlackRock)	$2.67B	Not published	BVI company, 506(c) / 3(c)(7)	Qualified purchasers	BNY Mellon
USDY (Ondo)	$2.15B (2026-07-31)	3.55% (APY)	Tokenized note, BVI SPV	Reg S, non-US only	Coinbase Prime
iBENJI (Franklin)	$1.73B	Not published	BVI company, 506(b) / 3(c)(7)	Qualified purchasers, $5M	Not disclosed
USTB (Invesco)	$908.5M	3.51% (30-day yield)	Delaware statutory trust, 506(c) / 3(c)(7)	Accredited + QP, $100k	BNY Mellon
JTRSY (Janus Henderson)	$881.7M	3.24% (30-day annualised)	BVI segregated portfolio company	Non-US professional, $500k	J.P. Morgan
BENJI / FOBXX (Franklin)	$753.2M (2026-06-30)	3.50% (7-day SEC yield, net)	Registered 1940-Act government money market fund	Retail, $20	JPMorgan Chase
WTGXX (WisdomTree)	$717.5M (2026-06-30)	3.45% (7-day SEC yield, net)	Registered 1940-Act government money market fund	Retail, $1	BNY Mellon
OUSG (Ondo)	$378.35M (2026-07-31)	3.43% (30-day yield)	Delaware limited partnership	Accredited + QP, $5k instant	Coinbase Prime
VBILL (VanEck)	$193.1M	3.43% (30-day APY)	BVI company, Reg D	Qualified purchasers, $100k	State Street
USTBL (Spiko)	$160.2M (2026-07-31)	3.59% (annualised, from NAV)	French UCITS money market fund, EU MMFR	Retail, $1	CACEIS
thBILL (Theo)	$69.1M	3.20% (30-day APY)	Panama, fund of tokenized funds	Institutional	Not disclosed

Four notes. USTB was renamed from Superstate to the Invesco Short Duration US Government Securities Fund in July 2026, and its $908.5M includes a $147.3M off-chain book-entry tranche; rwa.xyz shows $757.8M because it counts only tokens held onchain. Both bases are defensible, so state which you mean. BENJI and WTGXX are the only two here that are registered money market funds under Rule 2a-7, which is why they alone carry a true 7-day SEC yield — and why comparing their figures with the APYs above is comparing different measurements. USTBL, ISIN FR001400ODM9, is the only fund here regulated under EU money-market rules. And thBILL’s assets are reported across three trackers with a 70% spread, the weakest row we publish.

How to invest in tokenized treasuries

For most readers the honest answer is: you probably cannot, and the gate is legal rather than technical.

• Eligibility first. BUIDL, iBENJI, USTB, OUSG and VBILL go to accredited investors and qualified purchasers. USDY and USYC exclude US persons under Regulation S. The retail exceptions are the registered funds — BENJI at a $20 minimum and WTGXX at $1 — and Spiko’s USTBL, also $1.
• KYC, then whitelisting. The transfer agent approves a wallet address; unapproved addresses cannot receive the token.
• Check the chain. VBILL’s minimum is $100,000 on Avalanche, BNB Chain and Solana, but $1,000,000 on Ethereum, while OUSG’s instant mint and redeem is Ethereum mainnet only. BUIDL’s management fee runs 18 basis points on BNB Chain and 50 on Ethereum — the same fund, nearly three times the cost.
• Read the redemption terms. BUIDL requires requests to reach the transfer agent between 08:00 and 15:00 ET to settle same-day, while USTBL offers instant withdrawals up to €500,000 a day, subject to liquidity. BENJI, the most retail-accessible product here, processes only during business hours — the least onchain-like redemption on the board.
• Weigh fees against yield. OUSG’s 0.15% fee is waived to 0% until 2027-01-01, USYC charges no management fee but takes 10% of yield, and USTBL charges 0.25%.

Every field above is kept current per product on the Yield Board, each cell carrying its source and date.

Types of treasuries that can be tokenized

The US Treasury issues bills, notes and bonds. Bills mature in one year or less and sell at a discount to face value; notes run two to ten years with a semiannual coupon; Treasury bonds run twenty or thirty years, also with a coupon. Everything in the table above sits at the short end, for a structural reason: holding a $1.00 NAV steady requires paper whose price barely moves.

The long end has been wrapped, differently. Ondo’s TLTon tokenizes the iShares 20+ Year Treasury Bond ETF, at $18.5M as of 2026-08-03 — a structured note with a first-priority security interest held by Ankura Trust Company, not a fund share, redeeming 24/5 rather than 24/7. Its interest-rate risk is nothing like a bill fund’s, and the rule generalises: bring an exchange-traded fund onchain and the token inherits the duration of what it wraps.

Who uses tokenized treasuries and why

• DeFi collateral. A yield-bearing government bond fund pledged against a borrow position earns the Treasury rate while it sits as margin. A bank deposit cannot, which is why whitelisted tokens exist.
• Stablecoin reserves. Ethena’s USDtb, at $401M, holds roughly 90% of its reserves in BUIDL — a common design and a common counting error. Our page on stablecoin yield covers where those payouts come from.
• Corporate and crypto treasury. Companies with large idle stablecoin balances use these funds as a cash sleeve without converting to fiat and back.
• Non-US institutions. Reg S products such as USDY and USYC serve institutional money outside the United States, a large share of what gets called institutional adoption.

How big is the tokenized treasuries market?

$16.16B on rwa.xyz’s “tokenized US Treasury funds” definition, as of 2026-08-03. Competing totals are not rival measurements of one thing; they are different definitions:

• $26–28B for “treasuries and cash equivalents”, which folds in yield-bearing stablecoins;
• $26.6B for DefiLlama’s entire real-world asset category on 2026-08-03, including tokenized gold, equities, private credit and real estate.

About $2.98B of what gets counted here does not belong. Spiko’s $2.23B tracker entry is only 6.7% the US fund: €901.8M is the euro T-bill fund and $943.9M is the Spiko Amundi Overnight Swap Fund, whose return comes from total return swaps with BNP Paribas over a basket of roughly 105 equities, not from government paper. Hastra’s wYLDS, at $505M, wraps a tokenized face-amount certificate — unsecured debt of Figure Certificate Company, not a claim on a segregated portfolio. And USDtb’s $401M already sits inside BUIDL’s $2.67B; counting both counts the same bills twice.

Anyone quoting assets under management for this market should say which definition they used, and most do not.

Are tokenized treasuries safe?

The credit risk of short-dated US government debt is the safest leg of the structure. The risk sits in what is wrapped around it: an unregistered offshore vehicle, a transfer agent, a custodian, a smart contract, an oracle publishing the price, and in one case a second fund underneath the first. These are securities rather than bank deposits, and protections that attach to a US-registered fund do not attach to a BVI 3(c)(7) vehicle. Redemption liquidity is a manager’s commitment, not a feature of the paper.

A practical test: can you name the custodian, the auditor, the transfer agent and the legal wrapper of what you hold, and does the manager publish a yield with its metric attached? For BUIDL and iBENJI the answer to the second question is no. For USYC the issuer’s own website was off by a factor of ten. Neither fact condemns the asset class; both argue for reading primary sources instead of trackers. How we reconcile conflicting sources is set out in our calibration notes and across our work on real-world assets onchain.

Frequently asked questions

What is the downside of tokenization?

You take on every risk of the wrapper on top of the risk of the underlying paper: unregistered offshore vehicles, transfer restrictions on who may receive the token, smart contract exposure, and yields that cannot be compared like for like because only some of these funds file under Rule 2a-7. Published data is unreliable too: on 2026-08-03 one manager’s own website understated its fund tenfold, and two trackers disagreed on another fund’s size by 19%.

Which company is leading in tokenization?

It depends what you measure. By assets in a single product, Circle’s USYC led our set at $3.01B on 2026-08-03, ahead of BUIDL at $2.67B. By platform reach, Securitize is transfer agent for both BUIDL and VBILL, the most widely used infrastructure among the funds we track. By brand pull it is BlackRock: BUIDL made a global asset manager’s presence here impossible to ignore.

What are the three types of treasuries?

Treasury bills, Treasury notes and Treasury bonds — bills up to one year, sold at a discount; notes from two to ten years with a coupon; bonds at twenty or thirty years with a coupon. The tidy “three types” framing omits TIPS and floating-rate notes, which are also US Treasury securities. Almost every tokenized product on the market today holds bills.

What is a tokenized treasury for dummies?

A fund buys Treasury bills and keeps them at a custodian bank. Instead of recording your shares only in a ledger at a transfer agent, it also issues them as a token on a blockchain. You can move that token between approved addresses at any hour and, in some products, redeem it into a stablecoin the same day. The interest still comes from the government paper. The token is the receipt, not the investment.