Crypto Traders Shift $7.4 Billion to Tokenized Treasuries for 4.893% Yield

Assets in tokenized Treasury and money market products have surged by 80% to $7.4 billion, according to a report. This significant increase reflects a growing trend among crypto traders who are shifting away from stablecoins in favor of higher-yield alternatives. The report highlights that tokenized Treasury products, which include Treasury funds issuing their own tokens and tokenized U.S. government bonds, have seen substantial growth. Major issuers such as BlackRock, Franklin Templeton, and Janus Henderson have experienced a tripling of their combined holdings.

The primary driver behind this shift is the yield advantage that tokenized Treasuries offer over stablecoins. Stablecoins typically do not distribute yield to holders, making them less attractive compared to tokenized Treasuries, which do provide returns. This has led traders to move their assets towards tokenized Treasuries, seeking more lucrative savings options. The yields on Treasury bonds are influenced by interest rates, which remain relatively high due to concerns over inflation. Currently, 20-year U.S. Treasuries yield approximately 4.893%.

This trend poses a significant risk for stablecoin issuers. These issuers generate revenue by holding Treasuries as collateral and collecting interest payments. If the outflow from stablecoins to tokenized Treasuries continues, issuers may face a loss of a key revenue source. Additionally, they could be pressured to offer yields on their own stablecoins to remain competitive. Despite the rising interest in tokenized Treasuries, the demand for stablecoins has also been increasing. The supply of stablecoins has steadily risen from $2.5 billion in January 2025 to $255 billion in July 2025, indicating that while tokenized Treasuries are gaining traction, stablecoins still hold a significant place in the market.