Jan 30, 2026

Mathew Harrowing — Instruxi.io

Since January 1, 2025, tokenized U.S. Treasury debt expanded from approx. $3.9B to $8.9B (+127%), and by January 28, 2026 the category stood at $10.0B total value on RWA.xyz. Within that, BlackRock’s BUIDL (launched March 20, 2024) is currently about $1.71B with ~109 holders. Franklin Templeton and other institutional giants are pouring resources into blockchain-based Treasury products. 

With institutions now clearly willing to run regulated Treasury exposure on public-chains at multi-billion scale, is “faster access to the same T-bills” really the ceiling of what we intend to build with this infrastructure? It’s all a bit boring. 

The Conservative Play

Tokenized Treasury bills are the lowest-risk, highest-comfort starting point for real-world assets on-chain. The underlying instrument is short-duration sovereign debt with mature custody, pricing, and risk models. The legal wrapper is familiar (fund shares, notes, depositary receipts, or similar structures). Operationally, it maps cleanly to existing institutional workflows: KYC/AML is straightforward, volatility is low, and “cash management yield” is an already accepted mandate. In other words, if you want to prove that regulated assets can move on public rails without frightening compliance, Treasuries are the obvious candidate and I think the case is proven. 

There are benefits to Tokenized T-bills, just not a lot. Tokenization can reduce operational latency, extend access beyond traditional market hours, and make position transfers and reporting more continuous. It can also enable cleaner automation around subscriptions/redemptions, corporate actions, and transfer restrictions However, most tokenized Treasury products still preserve the same market structure,  gated access, controlled transfer, and limited composability. The asset behaves like a digitally wrapped version of the old instrument, useful for moving and holding, but not designed to participate in new on-chain financial primitives. Institutional investors represent approximately 70% of deployed capital in tokenized Treasury products. Corporate treasuries, sovereign wealth funds, asset managers are the primary users.

It is hardly exciting. Notice who's missing? Everyone else.

If the core outcome is that the same institutions hold the same exposure through a new wrapper, then tokenization is primarily an efficiency upgrade. We know Treasuries can be tokenized, and the market is proving it but let’s not stop there .

The capital allocation hasn't changed. The gatekeepers haven't changed. We moved the same exclusive system to a technology that was supposed to dismantle exclusivity. Here's what institutional adoption actually proves: financial institutions will use blockchain when it makes existing processes more efficient. What it doesn't prove: that marginally faster Treasury settlements represent the full potential of tokenized real-world assets.

The infrastructure exists. The regulatory pathways are clearing. The capital is committed. And we're using all of it to do exactly what we did before, just slightly better.

The Technical Capabilities We're Not Using

Tokenized assets offer capabilities that legacy systems can’t match. Most current implementations capture only the low-hanging fruit, digital issuance and cleaner reporting, while leaving the genuinely transformative capabilities unused.  The real win is moving the entire operational tail from subscriptions to treasury management, redemptions, and collateral eligibility, on-chain.

By using Decentralized Identifiers (DIDs) and Verifiable Credentials (VCs), we can move toward credentialed wallets. Once a wallet is verified (KYC/AML, jurisdiction, accredited status), that status can enable token-gated access to assets, data, and products without repeating the onboarding. Additional value is created when off-chain data, NAV, custody statements, and encumbrances is orchestrated into signed, machine-consumable feeds. Token-gating allows jurisdictional segmentation and role-based permissions to be built directly into the asset. Compliance then becomes automated.

The end result is a continuous, automated golden thread from the data that verifies the asset to the token that represents it and also the controls that govern it. The capabilities that move tokenization from a “better wrapper” to a new financial system.

What Innovation Actually Looks Like

There are still limitations to adopting the technology, but they are relatively few. The infrastructure that institutions have built for tokenized Treasuries represents a genuine technical achievement. Real-time asset verification, cross-chain interoperability, and continuous proof of reserves require serious engineering. But the same infrastructure that makes Treasury bills marginally more convenient also enables entirely new financial products that cannot be created in traditional markets.

RAAC’s pmUSD stablecoin launched in January 2026 and, at launch, ranked among the highest-yielding pools on Curve Finance (yields in DeFi can be highly variable and incentive-driven). This is a fundamentally new instrument that combines asset backing with DeFi liquidity mechanisms to generate yields on passive assets in ways traditional finance does not replicate.

pmUSD uses the same verification infrastructure, compliance frameworks, and blockchain rails that tokenized Treasuries require. But instead of reproducing Web2 finance on Web3 infrastructure, it enables products that only make sense in blockchain-native markets. This is infrastructure unlocking financial products that were not feasible even 12 months ago, new categories of instruments built to exploit blockchain’s distinctive capabilities rather than merely modernize legacy settlement.

The Infrastructure Stack

At Instruxi we built our platform around the complete stack that institutional tokenization requires. 

• TrustSync delivers continuous proof of reserves through real-time monitoring of off-chain financial systems. Instead of monthly or quarterly attestations, institutions get cryptographic verification that tokenized positions remain fully backed by underlying assets at all times. The platform supports over 1,000 simultaneous reserve feeds, each updating independently with most publications occurring within two to three minutes of data availability.

• uBuild's low-code platform addresses integration challenges by enabling seamless connection between existing Web2 systems and Web3 capabilities. Successful institutional adoption happens through augmentation of existing systems rather than replacement. Whether you're tokenizing Treasuries or launching asset-backed stablecoins with market-leading yields, the deployment pathway is identical.

• Enforcer's data governance framework addresses compliance complexity through dynamic policy management using intent and consent-based models. Built-in GDPR compliance, role-based access controls, proof of policy enforcement provide the governance layer that any tokenized market needs to scale. 

These solutions work for tokenized Treasuries. They also work for products that push far beyond what traditional finance can deliver. The infrastructure is the same and our clients imagination determines the outcome. Our integration with Chainlink's ecosystem provides the oracles, cross-chain capabilities, and compliance infrastructure that both conservative and innovative tokenized products require.

What Comes Next

Conservative projections suggest the tokenized Treasury market will reach $14 billion by 2026 through steady institutional adoption. That market will exist and grow.  But the real opportunity extends far beyond digitizing existing instruments. As institutions prove that tokenization works at scale, the framework extends to products that leverage blockchain's unique capabilities rather than simply replicating traditional finance.

RAAC's pmUSD, built on Instruxi's verification and minting infrastructure, demonstrates what's possible when you combine institutional discipline with genuine blockchain innovation. This iterative approach builds the foundation for the next generation of financial markets.

The Real Question

For institutions shaping a tokenization strategy, the issue is practical: what do you build once you have regulated assets running on public rails?

Tokenized T-bills are a useful starting point because they are conservative. They show that custody, permissions, reporting, and governance can meet institutional standards on-chain. They demonstrate that regulated distribution can be engineered to work. They also signal commitment, because serious firms are investing capital and operational effort. In that sense, tokenized Treasuries are a solid validation of the stack.

The next phase depends on product design. The infrastructure already supports end-to-end lifecycle automation (subscriptions, redemptions, collateral eligibility), machine-consumable reserve state, reusable identity and eligibility via DIDs and verifiable credentials, and policy enforcement that executes consistently at transaction speed. Institutions that push into these capabilities will define how tokenized markets actually operate. Institutions that remain focused on wrapped Treasuries will compete mostly on basis points, access terms, and brand, because the underlying product behavior stays largely unchanged.

Sources

Yellow.com. "Tokenized U.S. Treasuries Hit $7.3B in 2025: Complete Guide to Digital Treasury Bonds." 2025. https://yellow.com/en-US/research/tokenized-us-treasuries-hit-dollar73b-in-2025-complete-guide-to-digital-treasury-bonds

Benzinga. "Why Tokenized Treasury Markets Are Becoming A New Safe Haven For Investors." December 2, 2025. https://www.benzinga.com/Opinion/25/12/49156858/why-tokenized-treasury-markets-are-becoming-a-new-safe-haven-for-investors

Winston & Strawn. "DTCC Partners with Digital Asset to Tokenize DTC-Custodied U.S. Treasury Securities." December 17, 2024. https://www.winston.com/en/blogs-and-podcasts/capital-markets-and-securities-law-watch/dtcc-partners-with-digital-asset-to-tokenize-dtc-custodied-us-treasury-securities

Broadridge. "Next-gen markets: The rise and reality of tokenization." 2025. https://www.broadridge.com/_assets/pdf/next-gen-markets-the-rise-and-reality-of-tokenization.pdf

Chainlink. "What Are Tokenized Treasuries?" https://chain.link/article/what-are-tokenized-treasuries

Keyrock. "What are Tokenized Treasuries? A guide." July 9, 2025. https://keyrock.com/knowledge-hub/what-are-tokenized-treasuries-a-guide/

Transak. "What Are Tokenized Treasury Bills? Best Guide To Blockchain-Based T-Bills." 2025. https://transak.com/blog/what-are-tokenized-treasury-bills

INX. "Tokenized Treasuries: The Safest Way to Earn Yield On-Chain in 2025." October 30, 2025. https://www.inx.co/tokenized-treasuries-the-safest-way-to-earn-yield-on-chain-in-2025/

ChainUp. "How Tokenized Treasury Bonds & Private Credit Are Redefining Traditional Finance." November 11, 2025. https://www.chainup.com/blog/tokenized-treasury-bonds-private-credit-blockchain-finance/

Instruxi. "From Promises to Proof: The Technical Architecture Behind Continuous Asset Verification." Medium, August 8, 2025. https://instruxi-dev.medium.com/from-promises-to-proof-the-technical-architecture-behind-continuous-asset-verification-d3f7caff48cf