Backed Finance, a Swiss-based tokenization company, announced in a press release on Friday that the Base blockchain of cryptocurrency exchange Coinbase now supports its tokenized short-term U.S. Treasury offering.
The Base network, which also houses the well-known social tokenization tool Friend.Tech, now has its first real-world asset token.
BlackRock’s short-term U.S. treasuries exchange-traded fund (ETF), which provides investors with a yield of 5.25% annually, is available as a blockchain-based cryptocurrency token called bIB01 from Backed. It was issued under the Swiss law governing tokenized securities. Qualified investors and authorized distributors who passed the company’s know-your-customer (KYC) and anti-money laundering (AML) checks may purchase the offering. The token cannot be purchased by investors or organizations based in the United States.
One of the trendiest topics in cryptocurrency this year is the tokenization of real-world assets (RWAs), a general term for tokenizing and putting on blockchains traditional financial instruments like government bonds, private equity, or credit. A research from the Boston Consulting Group predicts that by 2030, the market for tokenized assets might swell to $16 trillion.
Due to their high yield and minimal risk, U.S. Treasury bonds are regarded as a gateway for tokenization initiatives by many investors in digital assets, fund managers, cryptocurrency companies, and decentralized autonomous organizations (DAOs). According to rwa.xyz data, the market for tokenized treasuries has increased six-fold this year to $666 million, with asset management company Franklin Templeton being the dominant player.
Base, according to Backed, provides a “low-cost, developer-friendly way to build on-chain,” and although its code is compatible with Ethereum, its transaction fees are “ten times cheaper.”