The ratio of tokenized fund value to stablecoins has increased from $2.99 to $11.39 per $100 over the past two years. This shift reflects a growing demand for yield among on-chain investors, as traditional stablecoins like USDT and USDC do not offer returns to holders.
The total market value of stablecoins is approximately $300 billion. Tokenized real-world assets, including Treasury-backed and money market products, now account for 10% to 17% of this ecosystem. The total value of these tokenized funds is estimated between $15 billion and $33 billion.
Market growth is concentrated in products from major issuers. Circle’s USYC holds $2.5 billion to $3 billion, BlackRock’s BUIDL fund has $2.2 billion to $2.7 billion, and Ondo’s USDY holds $2.1 billion to $2.3 billion. Some products have seen monthly growth of 8% to 10%.
Regulatory developments, such as the GENIUS Act expected in 2025, may impact this sector by restricting yield payments on payment stablecoins while favoring tokenized funds. JPMorgan analysts estimate that tokenized funds currently represent 5% of the stablecoin ecosystem, with a potential cap of 10% to 15% without further legal improvements.
Challenges remain regarding the liquidity and transferability of tokenized fund shares due to KYC requirements and compliance layers. Despite this, protocols like Ethena are increasingly using these assets as collateral or reserves, signaling institutional interest in the long-term potential of on-chain settlement for traditional financial products.
