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From T-Bills to Private Equity: Tokenization Grew Up Fast

Key Takeaways:

  • US Treasury Debt and commodities made up 90%+ of tokenized assets in January 2024.
  • Treasury share peaked at 60-65% in mid-2024 before compressing to approximately 45-50%.
  • Two distinct phases visible in the chart: yield-seeking 2024, diversification 2025-2026.

As of January 2024, the market for tokenized assets was heavily concentrated in two areas: US Treasury debt, making up around 40% of the total value, and commodities, accounting for another 50%. All other types of assets that could be tokenized – things like real estate or company stock – represented a small fraction, likely between 5 and 10% combined. While the market was active, it was still in its early stages of development.

According to data from a16z crypto and rwa.xyz, the market for real-world assets is rapidly expanding. While treasuries and commodities remain important, a new range of financial products has emerged in just two years. These include special finance, active investment strategies, asset-backed credit, private equity, debt from non-US governments, stocks, real estate, venture capital, and various types of corporate and diversified credit. Essentially, a market previously dominated by just two asset types has grown to encompass twelve distinct categories in a short period.

Reading why that happened requires reading the chart in two phases rather than one.

Phase one: the yield play

As a crypto investor, one of the biggest trends I saw throughout 2024 was the focus on earning yield. With interest rates being higher than usual, tokenized US Treasury bills became really popular. They allowed crypto companies and decentralized organizations like mine to actually *earn* a return on funds we had sitting around, all without having to cash out and leave the crypto world.

It’s now possible to easily earn a solid return – around 4-5% per year – by converting USDC into digital representations of U.S. Treasury bills, all while maintaining immediate access to your funds. This offered a practical solution for managing money, and the market has clearly taken notice.

As a crypto investor, I’ve been watching something interesting happen this year. Tokenized Treasuries – basically government bonds on the blockchain – have really taken off. Back in January, they made up around 40% of the tokenized asset market, but by the middle of the year, that jumped to around 60-65%. This surge meant other areas, like tokenized commodities, didn’t necessarily *lose* ground, but their share of the market got smaller simply because Treasuries were growing so much faster. It felt like everything was shifting towards earning yield on the safest possible asset – US Treasuries – right on the blockchain.

This initial success happened because U.S. Treasury bonds were the simplest assets to turn into tokens. They’re already well-established, easily traded, legally compliant, and have transparent pricing. Setting up the necessary technology was much easier than it would be for more complex assets like private equity or commercial real estate. Essentially, the market chose the easiest and most straightforward option, and it worked.

Phase two: the diversification

Around mid-2025, a change occurred with Treasury shares. They began to decrease in value, not due to a lack of interest in returns, but because the systems put in place earlier were now being used for more sophisticated investments.

Special Finance, making up around 8-10% of the market, involves complex financial products that used to be difficult and costly to transfer. By converting them into tokens, these transfers become much simpler. Asset-Backed Credit, which represents loans like mortgages and auto loans linked to real-world assets, is also moving onto the blockchain, allowing these loans to be divided into smaller pieces and offered to more investors. Finally, Active Strategies refers to investment products that are now being actively managed on the blockchain.

Private equity, a rapidly expanding area of investment, is a key trend to watch. Traditionally, private equity has been difficult to buy or sell quickly, often requiring investors to lock up their money for years. It was mainly available to large institutions, and any attempts to trade ownership were slow and costly. While tokenization doesn’t fix every issue with private equity, it does make it much easier to trade and more accessible. Tokenizing a private equity investment allows it to be transferred almost instantly, instead of taking weeks.

What the shift actually means

From my research, the adoption of new financial infrastructure seems to happen in two distinct phases. It always begins with a straightforward application – something that offers immediate benefits with minimal hassle. This initial step is about building the foundational systems, attracting investment, and setting the legal groundwork. Only then, once that base is solid and the market has confidence, do we see more complex and high-value assets being integrated into the system. It’s a progression from simple to sophisticated, built on a foundation of trust and proven functionality.

Tokenizing government bonds (Treasuries) was a natural starting point because they’re reliable, uniform, and widely traded. This demonstrated that tokenization can work for large financial institutions. Now, we’re seeing a second wave with assets like private equity, real estate, and complex loans. These are more challenging to tokenize and involve greater legal hurdles, but they represent significantly larger amounts of money than the Treasury market.

Currently, the market for tokenized assets is around $34 billion, according to rwa.xyz. However, experts predict significant growth: McKinsey forecasts $2-4 trillion by 2030, and Standard Chartered estimates as much as $30 trillion by 2034. This growth won’t come from simply tokenizing government bonds; it will require larger-scale tokenization of assets like private credit, real estate, private equity, and infrastructure – areas that have been steadily gaining traction since mid-2025.

A recent chart from a16z illustrates a changing trend. While Treasuries and commodities currently lead the way – benefiting from their established position and existing infrastructure – the market is clearly expanding beyond simply seeking high returns. It’s evolving into something much bigger.

This article is for informational purposes only and shouldn’t be taken as financial, investment, or trading advice. Coindoo.com doesn’t support or suggest any particular investment or cryptocurrency. Before making any investment choices, be sure to do your own research and talk to a qualified financial advisor.

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2026-05-30 16:02