Tokenized US treasuries may hit $3 billion by the end of 2024, analyst says

Tom Wan, a research analyst at 21co, predicted that tokenized US treasuries could reach $3 billion by the end of 2024. He noted that the growing interest in this asset class from crypto projects looking to diversify their treasury could push it to hit this milestone.

Also Read: Goldman Sachs plans to launch tokenization products by the end of the year

Wan’s predictions highlight the growth of real-world asset (RWA) tokenization as a major use case for blockchain technology. Interest in this category is increasing from traditional financial institutions, with Goldman Sachs now planning to launch its own tokenized funds.

Crypto projects DAOs tap tokenized US treasuries to diversify treasuries

According to data from Dune Analytics, the total asset under management for tokenized US treasuries is $1.78 billion. This means the asset class must record almost 100% growth over the next 6 months to reach $3 billion. However, Wan believes that more Decentralized Autonomous Organizations (DAOs) will invest in tokenized assets in the coming months.

DAOs for several crypto projects now consider on-chain RWA an ideal asset class when diversifying their treasuries. Wan noted that stablecoins and tokenized US treasuries are their top two options. These products offer a risk-free opportunity to yield-bearing assets directly within the crypto ecosystem. He said:

“With the maturity of tokenized US treasuries, over 15+ products on EVM Chains, and close to $2B AUM, DAO is starting to include yield-bearing products like BUIDL, USTB, USDY, and USDM in its treasury.  We would definitely see this trend continue in the long run.”

DeFi platform and stablecoin issuer, MakerDAO, recently announced plans to invest $1 billion of its reserves into tokenized US treasuries and has called on protocols to apply. At least three major platforms for US treasuries tokenization, Securitize, Ondo Finance, and Superstate, have said they will participate in the open competition.

Before MakerDAO, layer-2 network Arbitrum DAO also allocated 35 million ARB worth $27 million to tokenized RWA protocols. More crypto protocols are expected to opt for similar options. Tokenized US treasuries offer crypto projects the opportunity to gain exposure to US treasury yields directly from within the crypto ecosystem.

TradFi companies slug it out in the tokenization sector

Meanwhile, the tokenization of real-world assets is set for new heights, especially as more traditional financial institutions have become interested. Their interest aligns with the predictions of major consulting firms such as McKinsey and Boston Consulting Group that the sector could be worth trillions of dollars by 2030.

Also Read: BlackRock tokenized treasury fund BUIDL surpasses $500 million

So far, 17 platforms offer tokenized US treasuries, with Securitize and BlackRock BUIDL, which has over $500 million in AUM, being the clear leader. However, Franklin Templeton BENJI is quite close, with over $400 million, highlighting the competition among TradFi institutions in the tokenization space.

Other institutions are also getting involved. Goldman Sachs recently announced plans to launch three tokenized funds by the end of the year. The bank’s global head of digital assets, Mathew McDermott, disclosed this in a recent interview. Although he did not give details about the products, he mentioned that they will focus on the US and European markets.