Why U.S. Treasury bill funds are leading $29B RWA market

Tokenization is here to dominate. Over the past three years, the tokenized market cap of real-world assets (RWAs) increased by 20x.

Similarly, the tokenized RWA market cap grew to a new high of about $29 billion represented a 238% gain in a year.

RWA market cap peaks after 238% surge

The total RWA active market cap was $26.15 billion, more than a billion less than the total on-chain RWA cap at $27.77 billion.

The DeFi active TVL of this sector was $2.38 billion, growing alongside RWA Perps Open Interest (OI) at $1.95 billion.

Bonds dominated the sector’s market value, accounting for more than half of the deployed capital when examining the various asset classes in RWAs. These bonds included US Treasury bill (T-bill) funds and money market funds (MMFs) whose cap peaked at $16.25 billion.

Precious metals ranked second with a market cap of $5.83 billion, which is a third of what Bonds held.

Others had either a market cap of $2.3 billion or below. That is, private credit, tokenized stocks, real estate, reinsurance, equities, indices, and ETFs follow, respectively.

However, ownership of the stocks comes in three different types.

Actual ownership includes native issues, which are fully on-chain with no middleman, and wrappers, where the real stock is held somewhere else. The last were synthetics, which track the price with no actual ownership.

How U.S. Treasury bills dominate RWA market cap

Following the US T-bill fund leadership in this sector, it was worth analyzing the top issuers who were competing for dominance. But why were T-bills dominating?

Treasury bill funds are considered among the safest assets in the world.

For context, it is lending money to the government and receiving fixed returns upon maturity, usually within a year. They are typically short-term debts issued to the US government.

Circle issued 18.75% of the $16 billion market cap in T-bill funds, amounting to nearly $3 billion.

This indicated Circle’s money market fund, USYC, was ahead of Securitize’s BUIDL, capped at $2.5 billion. As indicated, US dollar bills were the most tokenized in the form of stablecoins.

Centrifuge [CFG] came third among the top issuers with $1.5 billion. Franklin Templeton and Ondo Finance [ONDO] caps of $1 billion and $972 million, respectively, completed the top five.

Issuance race heats up

The data showed that issuers were racing to tokenize assets across the globe. The small margins between the caps of the top five showed that there was no clear winner at the moment.

The race was very much on, as there were more RWAs to tokenize.

However, stablecoin issuers had an edge against the rest, as they are used to exposing traditional investors to crypto. Hence, their demand grew naturally as more users onboarded the crypto markets.

Final Summary

• RWA’s market cap peaks at $29 billion, representing 238% growth in a year.
• US Treasury bill funds dominated the tokenized assets market cap with $16 billion.