Circle Internet Financial, a stablecoin issuer, acquired Hashnote, the issuer of United States Yield Coin (USYC), a tokenized real asset (RWA) fund.
In a January 21 announcement, Circle said the transaction “will enable USYC to emerge as the preferred form of yield-generating collateral for cryptocurrency exchanges, as well as custodians and prime brokers.”
Hashnote’s USDY is the most popular tokenized fund by market capitalization, with a total value locked (TVL) of approximately $1.25 billion, according to data provider RWA.xyz.
As part of the deal, the stablecoin issuer is partnering with DRW, one of the largest institutional cryptocurrency traders. DRW plans to expand institutional-grade liquidity and settlement capabilities in USDC and USYC to facilitate “more efficient and seamless collateral management.”
“Circle plans to fully integrate USYC with USDC, providing seamless access between tokenized money market fund (TMMF) collateral and USDC,” the announcement said.
Top T-Bill issuers tokenized in TVL. source: RWA.xyz
growing market
According to CoinGecko, Circle’s USD Coin (USDC) has a market capitalization of approximately $48 billion, making it the second most popular stablecoin behind Tether’s USDt (USDT). As of January 21, its market capitalization was approximately $138 billion, according to CoinGecko.
Circle’s USDC has risen against USDT since December amid questions about Tether’s compliance with the Markets in Crypto-Assets Regulatory (MiCA) regulations, the European Union’s regulatory framework designed to standardize and regulate cryptocurrency markets. I’m doing it.
Tokenized RWAs (digital tokens representing claims on everything from U.S. Treasury bonds to works of art) are a $30 trillion market opportunity globally, Colin Butler, head of global institutional capital at Polygon, told Cointelegraph in August.
Demand for products that tokenize money market funds comprised of U.S. Treasury bills (T-bills) and other liquid, high-yield assets is surging.
Key competitors to Hashnote’s USDY include the BlackRock USD Institutional Digital Liquidity Fund (BUIDL) and the Franklin OnChain US Government Money Fund (FOBXX), with TVLs of approximately $630 million and $525 million, respectively.
The U.S. Treasury said in an October report that while Treasury tokenization “could lead to operational improvements and innovation in Treasury markets,” it could also pose risks to financial stability.
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