Tokenization is the process of converting over $1 billion worth of US Treasury bonds into digital representations that are stored on open blockchains. These tokenized Treasury securities, which are exchanged as tokens on the blockchain, stand in for US government securities.
Stay in the know on crypto by frequently visiting Crypto News Today
How Tokenization Works with Public Blockchains and the New Era of US Treasury Bonds
The market for tokenized US Treasury debts is rising significantly, as expected.
The total value of US Treasury notes tokenized on public blockchains like Ethereum, Polygon, Avalanche, Stellar, and others has recently surpassed one billion dollars, according to data provided by analyst Tom Wan of the cryptocurrency company 21.co.
CryptoCaster Quick Check:
Digital copies of US government securities, known as tokenized Treasuries, are exchangeable as tokens straight over the blockchain.
When compared to January of last year, the market value of this type of investment has increased by nearly ten times.
Moreover, since the traditional financial behemoth BlackRock announced the tokenized BUIDL fund based on Ethereum on March 20, it has seen an increase of 18%.
With a tokenized value of $245 million, BlackRock’s BUIDL fund is currently the second largest fund of its kind, only surpassed by Franklin OnChain U.S.
Franklin Templeton’s Government Money Fund (FOBXX), which has a 360.2 million dollar total value and a share represented by the BENJI token.
Historic purchases of Bitcoin ETFs
Wan claims that the demand for tokenized versions of these securities has surged due to the sharp rise in Treasury yields over the previous two years.
The 10-year yield, also referred to as the risk-free rate, has increased from 1.69% in March 2022 to 4.22%, which is the main driver of the trend.
In the decentralized finance market, this increase has affected how appealing loans and loans of stablecoins anchored to the dollar are.
Net inflows of $243.4 million have been recorded in the Bitcoin ETF market, and the value of BTC is expected to rise to $72,000 the next week after falling below $63,000.
After BlackRock’s IBIT and Fidelity’s FBTC, ARKB is now the third Bitcoin ETF to cross this mark in a single day. On Wednesday, FBTC experienced a record low of 1.5 million dollars, while IBIT saw inflows of 323.8 million dollars.
Hashdex ETF is the first Bitcoin ETF available in the US.
The number of spot Bitcoin exchange-traded funds (ETFs) offered in the US has increased to eleven. This action was taken more than two months after the first ten spot BTC ETFs were introduced.
The most recent addition to the list is the asset manager Hashdex’s Bitcoin Futures ETF, which has been traded under the ticker DEFI on the New York Stock Exchange since 2022.
This fund was changed from a futures-based fund to a spot Bitcoin ETF, and it is now known as the Hashdex Bitcoin ETF.
In contrast to other spot Bitcoin ETFs, the DEFI can retain up to 5% of its assets in BTC futures contracts that are traded on CME, according to a press release from Hashdex.
The company claims that by making this choice, DEFI will be able to provide a more predictable fund creation and redemption process as well as more precise tracking of the price of Bitcoin over time.
This strategy is novel for Bitcoin ETFs, but most S&P 500 ETFs attest to its widespread application in other settings.
The DEFI currently owns a small number of futures contracts in addition to 5,500 BTC. The fund has an expense ratio of 0.90%, which is higher than the other nine spot products but lower than Grayscale Bitcoin Trust (GBTC)’s1.50%.
We hope you found this article insightful. Before you go, please consider supporting CryptoCaster’s independent journalism.
In the world of media owned by billionaires like Elon Musk, Larry Fink (BlackRock), and Jamie Dimon (JP Morgan Chase), influence over narratives surrounding cryptocurrency and Web3 often reflects their interests. CryptoCaster is different. With no billionaire backers or shareholder obligations, we are committed solely to public interest journalism, covering crypto advancements and institutional changes without profit-driven motives.
Unlike much of mainstream media, which can fall into neutrality traps that obscure the real impacts on retail investors, we’re guided by transparency and integrity. We are unafraid to take a stand in the ongoing struggle against fiat banking dominance and in support of the monetary innovation driven by crypto and Web3. Reporting on issues like FTX, Binance, and Ripple, we bring a bold, unfiltered outsider’s view on global financial disruption—free from the constraints of traditional media narratives.
CryptoCaster remains paywall-free, accessible to everyone, thanks to the support of readers like you. Your contributions keep us independent and help ensure that critical information on the crypto landscape reaches all. If you value our work, please consider supporting us with a one-time contribution starting at just $1 in Bitcoin or Ether, or even monthly if you’re able. Scroll down to find our wallet addresses and help keep CryptoCaster independent and thriving.
Thank you for your support,
Kristin Steinbeck
Editor, CryptoCaster
Please Read Essential Disclaimer Information Here.
© 2024 Crypto Caster provides information. CryptoCaster.world does not provide investment advice. Do your research before taking a market position on the purchase of cryptocurrency and other asset classes. Past performance of any asset is not indicative of future results. All rights reserved.
Contribute to CryptoCaster℠ Via Metamask or favorite wallet. Send Coin/Token to Addresses Provided Below.
Thank you!
BTC – bc1qgdnd752esyl4jv6nhz3ypuzwa6wav9wuzaeg9g
ETH – 0x7D8D76E60bFF59c5295Aa1b39D651f6735D6413D
CRYPTOCASTER HEATMAP
