Tokenized US Treasuries surpassed $10 billion in total value this week, a milestone that confirms that the category has moved from proof of concept to operational infrastructure.
However, something happening behind this achievement is equally important: Circle’s USYC has surpassed BlackRock’s BUIDL as the largest tokenized Treasury product, indicating that distribution lanes and collateral mechanisms now matter more than brand recognition in determining which on-chain cash equivalents win.
As of January 22, USYC has $1.69 billion in assets under management compared to BUIDL’s $1.684 billion, a gap of approximately $6.14 million, or 0.36%.
Over the past 30 days, USYC’s assets grew 11% while BUIDL’s contracted 2.85%, a divergence that reads less like a marketing success and more like net creation flowing in one direction while refunds drain the other.
This is not a story about Circle beating BlackRock in a brand war. It’s about collateral workflow design overcoming logo recognition.
Furthermore, it ties directly into the infrastructure question that regulators and institutions are now asking out loud: who shapes the stack that turns idle crypto capital into productive and profitable collateral?
Distribution plus warranty surpasses the brand
USYC’s clearest structural advantage is distribution through exchange collateral avenues.
On July 24, Binance announced that institutional clients could hold USYC and use it as off-exchange collateral for derivatives, with custody handled through Banking Triparty or Ceffu and near-instant redemption into USDC.
Binance added BUIDL to its list of off-exchange collateral on November 14, four months after USYC.
That sequencing matters. If the cash collateral stack is first built within the derivatives and prime brokerage workflows, the product that is integrated before captures the flow.
USYC was not only listed, but integrated into the operational layer where institutions manage margin and collateral automation.
Circle explicitly positioned USYC as collateral with yield that rides along the USDC rails, meaning that institutions that already direct stablecoin flows through the Circle ecosystem can incorporate USYC without building new operational rails.
BlackRock’s BUIDL entered the market with brand authority but without the same plug-and-play integration into crypto-native collateral systems.
The mechanics of the product adapt to the commercial guarantee.
RWA.xyz labels the two products differently under “Revenue Usage.” USYC is marked as “Accumulated”, which means that interest accumulates within the token balance. BUIDL is marked “Distributes”, which means returns are paid separately.
This distinction is mechanical, not cosmetic. Collateral systems, especially automated margining and derivatives infrastructure, prefer set-it-and-forget balances where value accumulates without requiring operational handling of payments.
An accumulation structure is more clearly integrated into collateral automation than a distribution one.
For institutions creating collateral avenues that need to scale across multiple locations and counterparties, the simpler the structure, the lower the operational burden.
RWA.xyz lists substantially different entry requirements for the two products.
BUIDL restricts access to qualified US buyers and requires a minimum investment of $5 million in USDC. USYC targets non-US investors with a minimum of US$100,000.
The funnel difference is structural. Qualified Buyer status in the US requires $5 million in investable assets for individuals or $25 million for entities, a narrow gate that excludes most crypto-native funds, back desks and smaller institutional players.
USYC’s $100,000 minimum and non-U.S. eligibility open access to a broader set of offshore institutions, family offices, and commercial enterprises that operate outside U.S. regulatory perimeters but still require dollar-denominated, yield-generating collateral.
The BlackRock brand has weight, but it does not override access restrictions. If a fund cannot meet the Qualified Buyer threshold or operates outside of the US, BUIDL is not an option. USYC it is.
The addressable on-chain collateral market skews heavily toward non-US entities and smaller institutions, exactly the segment USYC is designed for.
Net creation versus net amortization
The simplest explanation for the change is the clearest: the flows moved.
USYC grew by 11% in the last 30 days, while BUIDL contracted by 2.85%. That is not a marketing differential. It is a net emission of one product, offset by net outflows of the other.
The recent change suggests a discrete event or allocation decision rather than a gradual drift. USYC’s Binance integration, cumulative revenue structure, and lower entry threshold reduce friction. BUIDL has not added a comparable distribution push in the same window.
Tokenized Treasuries worth $10 billion remain a small fraction of the $310 billion stablecoin market, but their role is moving from a niche experiment to an operational default.
The International Organization of Securities Commissions (IOSCO) noted in a recent guidance that tokenized money market funds are increasingly used as stablecoin reserve assets and as collateral for cryptocurrency-related transactions. These are precisely the interrelationships that drive USYC’s growth.
JPMorgan framed tokenized money market funds as the next frontier after stablecoins, focused on portability and collateral efficiency.
The bank’s analysis treats tokenized Treasuries not as an alternative to stablecoins but as an evolution of them. They are programmable cash equivalents that settle faster, move across blockchains more easily, and integrate into escrow systems with fewer operating expenses than traditional escrow arrangements.
With stablecoin yields close to zero, tokenized Treasuries offer a risk-free on-chain rate without requiring users to leave the crypto lanes.
Instead of parking cash in non-yielding stablecoins or taking it off-chain to earn returns, institutions can now hold yield-producing collateral on-chain that functions like cash but compounds like Treasuries.
What happens next?
The $10 billion milestone is less important than the capture rate it represents.
Tokenized Treasuries currently represent approximately 3% to 4% of the stablecoin float. If that rate doubles over the next 12 months, which is a conservative assumption given the current momentum in flow and collateral integrations, tokenized Treasuries could reach between $20 billion and $25 billion.
If collateral fliers accelerate and more venues replicate Binance-style off-exchange rails, the range extends to $40 billion to $60 billion.
All the metrics that matter are measurable: net issuance trends, collateral integration announcements, changes in eligibility requirements, and changes in revenue management preferences.
USYC’s 30-day growth rate and BUIDL’s contraction are early signs. Binance’s integration schedule is different. The funnel gap is one third.
USYC did not change BUIDL because Circle spent more than BlackRock on marketing. It changed because distribution, mechanics, and access restrictions aligned with how institutions actually use on-chain collateral.
The category surpassed $10 billion not because one flagship product dominated, but because multiple products now compete in terms of infrastructure: who integrates faster, who reduces friction, who widens the funnel.
Brand recognition opened doors. Collateral workflow design keeps them open.