The fast-growing market for tokenized U.S. Treasuries has a new leader.

Circle (CRCL), best known as the issuer of the USDC (USDC) stablecoin, has become the largest provider of tokenized Treasury exposure after its USYC token expanded to about $2.2 billion in supply, according to RWA.xyz data.

That growth pushed USYC past BlackRock’s USD Institutional Digital Liquidity Fund (BUIDL) – issued with tokenization specialist Securitize – which currently holds around $2 billion in assets. BUIDL's market share shrank to 18% from a 46% peak in May as competition increased with new entrants.

Tokenized real-world assets such as Treasury bills and money-market funds are gaining traction among crypto traders and institutional investors as yield-generating collateral and a tool to park onchain cash. Unlike traditional financial infrastructure, blockchain-based tokens allow near-instant settlement, transparent reserves and round-the-clock access.

Treasury-backed tokens also offer an additional advantage: they allow investors to earn interest while using the assets as collateral in trading strategies, potentially improving capital efficiency compared with holding stablecoins or cash.

Circle entered the tokenized fund market after acquiring Hashnote, the issuer of USYC, in early 2025.

BUIDL issuer Securitize did not return a request for comment by press time.

A booming market

A deeper dive into the data shows that much of USYC’s recent expansion appears to be linked to activity on BNB Chain, where crypto exchange giant Binance introduced the token as off-exchange collateral for institutional derivatives trading.

Under the structure, USYC can be held with partner banks through Binance Banking Triparty or with Ceffu, Binance’s institutional custody platform.

Since the launch in July, USYC supply on BNB swelled to $1.84 billion, data shows.

"Tokenized treasuries and repo as collateral is a major emerging use case and we are proud of how quickly this has grown," Circle CEO Jeremy Allaire said Friday in a post on X.

The broader tokenized Treasury market is also booming, hitting a fresh record high of over $11 billion, according to data from RWA.xyz. The sector added roughly $2.5 billion in market value, some 27%, since the start of the year.

The growth accelerated during January’s crypto market downturn, suggesting some investors may be parking capital in tokenized Treasuries to earn a steady yield while waiting for opportunities to redeploy funds into digital assets.