Tokenized Treasury funds have exceeded $2 billion in market capitalization, fueled by the growth of offerings such as BlackRock’s USD Institutional Digital Liquidity Fund (BUIDL). Data from RWA.xyz reveals a surge in the popularity of digital representations of U.S. government bonds, now being traded as tokens on various blockchain platforms, notably Ethereum. BlackRock’s BUIDL fund, in particular, has played a significant role in driving this growth, showcasing a broader trend of investors diversifying through tokenized assets. The total market cap of tokenized treasuries has increased by 2.61% over the past week, with Ethereum-based products accounting for $1.5 billion of the market share.
BlackRock’s BUIDL fund quickly amassed over $500 million in market cap shortly after its launch, positioning itself as a frontrunner in the tokenized treasuries space. It was followed by Franklin Templeton’s OnChain U.S. Government Money Fund (FOBXX) and Ondo Finance’s USDY. This growth reinforces the appeal of tokenized assets to investors seeking alternative avenues for diversification. Additionally, BlackRock has emerged as the largest holder of on-chain assets, surpassing Grayscale, an indication of its growing influence in the digital asset realm. The uptick in BlackRock’s ETF holdings signifies mounting interest from institutional investors in digital assets like Bitcoin and Ethereum, with ETFs gaining traction in the market.
Arkham Intelligence data as of August 16 showed BlackRock’s ETF holdings in IBIT and ETHA at $21.22 billion, surpassing Grayscale’s combined holdings in GBTC and ETHE funds totaling $21.20 billion. While Grayscale manages a higher overall balance, predominantly through its GDLC fund with around $460 million in assets, BlackRock’s ETF holdings have outpaced Grayscale’s. The shift towards digital assets is marked by BlackRock’s increasing presence in the space and the rising acceptance of ETFs among investors. This trend highlights a shifting landscape in the digital asset market, with institutions like BlackRock taking a more active role in diversifying their portfolios through tokenized assets like Bitcoin and Ethereum.
The $2 billion milestone in tokenized Treasury funds signifies a growing acceptance and adoption of digital assets representing traditional financial instruments like U.S. government bonds. The rapid growth in the market share of Ethereum-based products indicates a shift towards blockchain-enabled tokenization as a means of accessing and trading these assets. The success of BlackRock’s BUIDL fund and other offerings in this space underscores the attractiveness of tokenized assets to investors looking for innovative ways to diversify their portfolios and access new investment opportunities in the digital asset space.
As institutional players like BlackRock increasingly enter the digital asset market, the landscape of tokenized treasuries and on-chain assets is evolving rapidly. With BlackRock surpassing Grayscale as the largest holder of on-chain assets through ETFs, the industry is witnessing a significant shift toward mainstream adoption of digital assets within traditional investment circles. The competition between BlackRock, Franklin Templeton, and Ondo Finance in the tokenized treasuries space reflects a growing interest and appetite for digital representation of traditional financial instruments among investors. The rising market capitalization of tokenized Treasury funds signifies a maturing market for tokenized assets and blockchain-based financial products in the broader digital asset ecosystem.
