Tokenized Treasuries: The Part of RWA That Plainly Works

Of everything filed under real-world assets, this is the part that works, and it works for reasons that have nothing to do with being onchain.

What you are holding

Usually a share in a fund that buys Treasury bills and overnight repurchase agreements, issued as a token. The structures differ in how the yield reaches you: some tokens are rebasing, so the balance in your wallet grows; others accrue value so one token is worth progressively more. Neither is better, but the difference matters for accounting and for how a lending market prices the token as collateral.

Why this category functions and the others struggle

Because the underlying already has everything tokenization cannot create. It is the most liquid instrument in existence, it is priced continuously by a market far larger than crypto, the issuers process subscriptions and redemptions as ordinary daily business, and the yield is paid by a sovereign rather than by an incentive schedule.

Compare that with a tokenized building, where the token is fine and the asset underneath has no daily price, no routine redemption process and no buyer waiting.

What it is actually used for

• Parking idle balances at a yield that does not depend on crypto conditions – treasuries for treasuries, mostly corporate rather than retail.
• Collateral in lending markets, where a yield-bearing asset is strictly better than a stablecoin that pays nothing.
• The reserve behind some yield-bearing stablecoins, which is the same instrument one layer down.
• A place to sit between trades without leaving the chain, for anyone large enough that the yield exceeds the friction.

The honest limitations

Most of it is not open to you

Minimums are frequently institutional and eligibility is often restricted to qualified or non-US investors. A retail holder frequently meets this category through a yield-bearing stablecoin or a lending market rather than by holding the token directly.

The yield is a policy rate

It is attractive because short rates are. When they fall, the product does not become more attractive relative to anything – it just pays less, and the narrative around it cools accordingly.

You hold a claim, not a bill

Issuer and custodian risk are real and are the risk you accepted in exchange for the market risk you avoided. Compliant structures generally permit the issuer to freeze tokens, and that is documented rather than hidden.

What to check

1. Who the issuer is, under which regulator, and who the custodian is.
2. Whether reserves are attested, by whom and how often.
3. Redemption terms: who may redeem, at what minimum, and how quickly.
4. Whether the yield accrues by rebasing or by price, because it changes how everything downstream treats it.
5. Whether there is a secondary market, or whether exiting means redeeming through the issuer – DefiLlama RWA is the neutral scoreboard for the category.