According to digital asset data tracker CoinGecko, tokenized Treasurys in the United States experienced a significant surge of 641% in growth in 2023, with traditional finance companies getting involved. CoinGecko’s 2024 report titled “Rise of Real World Assets in Crypto” highlighted the progress in tokenizing real-world assets (RWA). The report revealed that tokenized Treasurys increased from $114 million in January to $845 million by the end of the year, indicating a remarkable 641% growth within a span of one year.
Tokenized securities are digital tokens that are backed by real-world assets such as stocks and bonds. For example, the Ondo Short-Term US Government Bond Fund utilizes the OUSG token to represent ownership of a share of the fund and its yield.
CoinGecko emphasized that Franklin Templeton, an asset management firm, is currently the largest issuer of tokenized Treasurys. The company has issued tokens worth $332 million through its On-Chain U.S. Government Money Fund, which accounts for 38.6% of the market. Franklin Templeton also launched a spot Bitcoin ETF in the U.S. in January, making it one of the ten ETF issuers to do so. The company is also vying to launch an Ethereum ETF and has already submitted an application to the U.S. Securities and Exchange Commission in February.
In addition to Franklin Templeton, other protocols that feature yield-bearing stablecoins backed by U.S. Treasury bills are gaining popularity. CoinGecko highlighted in its report that Mountain Protocol’s USDM tokens have increased from $26,000 to $154 million since their launch in September 2023.
Most tokenized U.S. Treasurys are based on the Ethereum network, with 57.5% of the tokens utilizing this platform. However, companies like Franklin Templeton and WisdomTree Prime have issued tokenized securities on Stellar, giving the network a 39% market share.
While tokenized treasuries experienced explosive growth in 2023, the growth rate slowed down in 2024. In January 2024, tokenized treasuries only grew by 1.9%, and as of February 1, they had a market capitalization of $861 million.
CoinGecko’s report also highlighted the rise of commodity-backed tokens, which have reached a market capitalization of $1.1 billion as of February 1. Tether Gold (XAUT) and PAX Gold (PAXG) dominate this market, holding 83% of the market capitalization for tokenized precious metals.
Furthermore, a new project has emerged that aims to tokenize uranium, enabling the redemption of this precious metal through digital tokens.
According to Trezor CEO, Bitcoin ETFs have made Coinbase a target for hackers and governments due to the increased attention and value associated with these ETFs.