Binance Adds USYC cUSDO as Institutional Collateral with Circle OpenEden Partnership

Binance has expanded its institutional collateral offerings by integrating yield-bearing stablecoins USYC and cUSDO, marking a strategic collaboration with Circle and OpenEden to bridge traditional finance (TradFi) and decentralized finance (DeFi). The move enables institutional clients to use these stablecoins as off-exchange collateral, leveraging tokenized U.S. Treasury interests for enhanced capital efficiency and risk management. USYC, issued by Circle, is backed by U.S. Treasuries and offers yield through interest accruals, while cUSDO, from OpenEden, similarly provides returns on reserves. Binance’s integration allows custodial partners like Binance Banking Triparty and Ceffu to facilitate custody and settlement, ensuring compliance with regulatory frameworks while enabling instant fungibility with USDC. The initiative aligns with broader market trends toward real-world asset (RWA) tokenization, addressing liquidity constraints faced by institutional traders. USYC’s design allows for seamless conversion to USDC, a feature critical for arbitrage and hedging strategies in volatile markets. The addition of cUSDO expands options for capital-efficient trading, as it mirrors the mechanics of money market funds while maintaining on-chain liquidity. Analysts note growing demand from large firms for safer yield-generating tools that avoid traditional banking systems, a shift driven by low interest rates and regulatory scrutiny of crypto custodians. However, tokenized Treasuries introduce counterparty risk, as the underlying assets are held in custodial accounts rather than directly by token holders. The integration also signals Binance’s competitive positioning in the RWA sector, where rivals like Coinbase and Kraken have launched similar products. By prioritizing institutional use cases, Binance aims to solidify its dominance in derivatives and lending markets, where collateral efficiency directly impacts trading margins. The success of USYC and cUSDO as collateral hinges on adoption rates and the ability to scale yield-generating mechanisms without compromising security or regulatory compliance. Market data indicates a surge in interest for tokenized Treasuries, with demand nearly doubling since the beginning of 2025. Social sentiment analysis from crypto data platforms shows bullish trends around both stablecoins, with key users and market watchers rotating capital into these assets. Trading volume for cUSDO has demonstrated consistent activity and a healthy premium, reflecting long-term confidence in the model. The collaboration underscores Binance’s focus on institutional-grade solutions, aligning with broader efforts to integrate traditional safety with crypto-native tools. Circle’s Chief Business Officer, Kash Razzaghi, highlighted the potential for faster capital flow across digital markets, enabling firms to access Treasury-like yields without exiting the crypto ecosystem. Binance’s Catherine Chen emphasized the importance of expanding capital-efficient trading options, a response to the evolving needs of institutional participants. The move follows earlier initiatives by Circle to expand USYC’s adoption, including integrations with DeFi protocols and lending platforms. As exchanges race to combine traditional financial instruments with blockchain capabilities, Binance’s integration of USYC and cUSDO sets a precedent for hybrid financial products tailored to institutional clients.

Source:

[1] [Binance Adds USYC as Circle Expands Footprint of Its Yield-...] (https://fortune.com/crypto/2025/07/24/binance-circle-usyc/)

[2] [Circle's USYC Now Supported as Yield-Bearing Off-Exchange Collateral for Binance's Institutional Clients] (https://www.circle.com/pressroom/circles-usyc-now-supported-as-yield-bearing-off-exchange-collateral-for-binances-institutional-clients)

[3] [Binance Integrates Tokenized Real-World Assets USYC and cUSDO Into Off-Exchange Settlement Solutions] (https://ktla.com/business/press-releases/cision/20250724CN36903/binance-integrates-tokenized-real-world-assets-usyc-and-cusdo-into-off-exchange-settlement-solutions)

[4] [Circle and Binance Push Stablecoin Innovation with USYC] (https://coincentral.com/circle-and-binance-push-stablecoin-innovation-with-usyc/)