Binance Integrates Circle’s USYC for Institutional Collateral as Tokenized Assets Reach $24B

Binance has announced the integration of Circle’s USYC token as eligible collateral for institutional over-the-counter (OTC) derivatives trading, marking a strategic expansion of its institutional product offerings. The move, effective July 25, 2025, enables institutional clients to use USYC—a hybrid asset combining stablecoin liquidity with Treasury-backed yield generation—as a collateral option on Binance’s BNB Chain. This development aligns with Binance’s broader initiative to enhance access to tokenized real-world assets (RWAs) and improve infrastructure for sophisticated market participants [1].

USYC, a tokenized money market fund with exposure to U.S. Treasuries and corporate bonds, allows institutions to earn yields without converting their holdings into fiat or other cryptocurrencies. By leveraging USYC, clients can deploy the token in derivatives contracts and margin requirements, maintaining liquidity while generating returns. The asset’s structure, which allocates holdings into interest-bearing government and corporate securities, positions it as a novel tool for risk management and capital efficiency [2]. Binance’s head of VIP and Institutional division, Catherine Chen, emphasized that the integration aims to deliver “more efficient and secure infrastructure tailored for sophisticated market participants,” reflecting the exchange’s focus on institutional-grade solutions [3].

The partnership with Circle reflects a growing trend in tokenized Treasury products. Data from RWA.xyz indicates that nearly $700 million in U.S. government debt is represented on-chain through mechanisms like reverse repos, with many linked to USYC. Tokenized RWA assets (excluding stablecoins) surged to $24 billion in June 2025, up from $15.2 billion in December 2024, signaling rising institutional interest in blockchain-based collateral [2]. Analysts suggest that USYC’s adoption by Binance could accelerate the onboarding of tokenized assets, particularly as demand for efficient collateral solutions intensifies [3].

Binance’s integration of USYC also aligns with its strategy to expand off-exchange derivatives and OTC settlement capabilities. Alongside USYC, the exchange has added cUSDO, another tokenized RWA, to its off-exchange settlement services. These moves aim to attract institutional clients by offering diversified collateral options and streamlined settlement processes. The use of tokenized assets is seen as a way to reduce counterparty risks and improve liquidity management for large-scale traders [4].

Market reception has been cautiously optimistic. While USYC’s yield-generating features appeal to institutions seeking passive income, challenges such as regulatory scrutiny and market volatility remain. However, the growing adoption of RWAs like USYC indicates a shift in how institutions view digital assets—as tools for risk mitigation and revenue generation rather than speculative investments. By supporting USYC, Binance reinforces its role as a bridge between traditional finance and crypto markets, offering institutions a seamless transition between fiat-backed tokens and digital assets [3].

The integration underscores the platform’s commitment to innovation in institutional finance. As tokenized Treasury products reach $1.7 billion in 2025, Binance’s collaboration with Circle highlights the potential for blockchain technology to enhance asset efficiency and liquidity management. The move also aligns with industry efforts to improve interoperability between traditional and digital financial systems, potentially paving the way for wider adoption of tokenized assets in mainstream markets.

Sources:

[1] Coindoo, "Binance Adds Circle's USYC Token for Institutional Collateral Use," [https://coindoo.com/binance-adds-circles-usyc-token-for-institutional-collateral-use/](https://coindoo.com/binance-adds-circles-usyc-token-for-institutional-collateral-use/)

[2] SiouxlandProud, "Binance Integrates Tokenized Real-World Assets USYC and cUSDO," [https://www.siouxlandproud.com/business/press-releases/cision/20250724CN36903/binance-integrates-tokenized-real-world-assets-usyc-and-cusdo-into-off-exchange-settlement-solutions](https://www.siouxlandproud.com/business/press-releases/cision/20250724CN36903/binance-integrates-tokenized-real-world-assets-usyc-and-cusdo-into-off-exchange-settlement-solutions)

[3] Bitcoin Insider, "Circle's USYC Joins Binance as Tokenised Treasuries Boom," [https://www.bitcoininsider.org/article/280241/circles-usyc-joins-binance-tokenised-treasuries-boom](https://www.bitcoininsider.org/article/280241/circles-usyc-joins-binance-tokenised-treasuries-boom)

[4] Binance, "Binance Now Supports Tokenized Real-World Assets (RWA)," [https://www.binance.com/en/square/post/27376134844017](https://www.binance.com/en/square/post/27376134844017)