Tokenized Treasuries Surge to Record $4.2B as Crypto Investors Seek Stability

Ondo Finance, BlackRock-Securitize, and Superstate posted significant gains, while Hashnote’s USYC struggled amid DeFi concerns.

As the crypto market faced a widespread correction, investors turned to tokenized U.S. Treasuries as a safer alternative, pushing their total market capitalization to a new peak.

Since late January, the combined market value of Treasury-backed digital assets has climbed by $800 million, hitting an all-time high of $4.2 billion, according to rwa.xyz.

Among top issuers, Ondo Finance’s (ONDO) products—OUSG and USDY—experienced a 53% surge, bringing their total valuation close to $1 billion. BlackRock and Securitize’s jointly launched BUIDL token gained 25%, surpassing $800 million. Meanwhile, Franklin Templeton’s BENJI token saw a 16% uptick to $687 million, and Superstate’s USTB skyrocketed over 63% to $363 million.

However, not all Treasury-backed assets saw gains. Hashnote’s USYC token lost over 20% of its market value, dropping to $900 million, largely due to turbulence surrounding DeFi protocol Usual. The USD0 stablecoin, which relies heavily on USYC reserves, saw its total supply shrink from $1.8 billion in January to under $1 billion.

“The recent rally in tokenized treasuries highlights a flight to quality, similar to how traditional investors pivot to government bonds during economic uncertainty,” said Brian Choe, head of research at rwa.xyz, in a statement to CoinDesk.

Choe noted that stablecoins grew faster than tokenized Treasuries during crypto’s bullish phase from November to January. However, as market sentiment turned bearish in February, Treasury-backed tokens saw accelerated growth while stablecoins lagged behind.

“This trend suggests that investors are not exiting the crypto space entirely but are reallocating funds into safer, yield-generating assets while waiting for market conditions to improve,” Choe added.