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Tokenization Boom: The Rise of On-Chain Traditional Assets

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The tokenized U.S. Treasury notes have crossed $1 billion in value on many public blockchains, a significant milestone for the cryptocurrency market. This growing pattern reflects traditional financial institutions’ increasing adoption of blockchain technology.

Data compiled by 21. co and Dune Analytics reveal that tokenized government securities are now distributed across 17 different products, with the majority based on the Ethereum, Polygon, and Stellar networks. 

Investment firm Franklin Templeton is leading the charge, which has tokenized over $360.1 million in assets through its Franklin OnChain U.S. Government Money Fund, utilizing the Polygon and Stellar blockchains.

According to Paul Wong, director of product, CBDCs, and institutions at the Stellar Foundation, the growth in tokenized treasuries is a direct result of more asset issuers recognizing the business potential of blockchain technology. 

“Blockchain is here to stay and is the future. We expect to see exponential growth in tokenization in the next few years,” Wong stated.

Stellar’s blockchain has emerged as a significant player in the tokenization space. Tokenized securities represent the most significant asset class on the network, with a total tokenized market cap exceeding $430 million as of late March.

PayPal Stablecoin Faces Circulation Decline

Another aspect is that PYUSD, PayPal’s stablecoin, saw a sharp 38% decrease in circulation in March, reaching $188.5 million. This reversal follows the stablecoin’s explosive early 2024 boom, which saw it double in market value in just one month by mid-January.

According to CoinGecko data, PYUSD’s market capitalization has been declining since late February despite the initial increase. It reached an all-time high of $312 million on February 26. As of March 29, the PYUSD Treasury had $14.9 million in U.S. Treasury bonds.

SushiSwap Embraces a “Labs Model”

The decentralized exchange SushiSwap has received a positive signal from its community to move forward with a plan to adopt a less decentralized “Labs model.” 

In a preliminary vote, over 62% of voters favored this transition, creating Sushi Labs, an autonomous entity responsible for managing the ecosystem’s administrative, technical, and operational aspects.

Under the proposed structure, token holders would still have a say in treasury allocations but would no longer participate in operational decisions. 

The new entity would also receive 25 million SushiSwap (SUSHI) tokens worth around $39 million at current prices and future airdrops from its affiliated protocols and partners.

The Sushi community has criticized this move, representing a shift away from the project’s decentralized roots.

SEC Delays Bitcoin ETF Options Approval

The SEC has decided to hold off on approving the NYSE to provide options for trading with ETFs that track Bitcoin.

That impacts trading on the New York Stock Exchange for the Bitwise Bitcoin ETF, Grayscale Bitcoin Trust, and other Bitcoin trusts. 

The SEC likewise turned down Nasdaq’s bid to trade options on BlackRock’s iShares Bitcoin Trust. May 29 is the next deadline for decisions regarding the NYSE’s plan.


This week’s Crypto Biz highlights the dynamic changes that occur inside the blockchain and cryptocurrency systems. 

The SEC’s delay in approving Bitcoin ETF options, SushiSwap’s move to a “Labs model,” and the rising trend of tokenizing traditional assets all show the industry’s ongoing evolution. 

Additionally, the instability of PayPal’s stablecoin highlights how blockchain technology is steadily merging with the broader financial sector. As these trends play out, the cryptocurrency community expects more changes and continuous progress in the digital asset industry.

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