The Aptos Foundation Announces the Launch of Ondo Finance's Yield-Bearing Stablecoin, USDY, on the Aptos Blockchain

The Aptos Foundation, which fosters development on the Aptos decentralized network, announced the launch of Ondo Finance's yield-bearing stablecoin

The Aptos Foundation, which facilitates development on the Aptos decentralized network, has announced the integration of Ondo Finance’s yield-bearing stablecoin, Ondo US Dollar Yield (USDY), onto the Aptos blockchain.

USDY, an instrument which is backed by United States Treasurys, will be available to non-US residents using the Aptos blockchain, the Aptos Foundation noted in the announcement. The digital asset has not yet been registered under the Securities Act in the United States.

In the announcement, the Aptos Foundation touted the benefits of stablecoins in catering to underserved communities and democratizing finance.

Stablecoin issuers are mopping up US debt

Curiously, stablecoin issuers and other crypto firms are emerging as major buyers of U.S. government debt.

One example is Tether, which backs its stablecoin USDT with U.S. dollar reserves and U.S. Treasury bills. In 2023, the stablecoin issuer disclosed that it held $72.5 billion of the T-bills.

USDT

$1.00

Related: Stablecoin Adoption Poses Greater Risk for Developing Nations — IMF

The potential of stablecoins to benefit the U.S. dollar has even garnered the attention of former U.S. lawmaker Paul Ryan. The ex-speaker of the U.S. House of Representatives highlighted how dollar-pegged stablecoins could create demand for the dollar amid geopolitical efforts to ditch it in international trade settlements, which could extend the U.S. dollar's dominance by decades.

Meanwhile, in July, Binance.US became one of the latest crypto firms to gain regulatory approval to invest customer funds in U.S. Treasury bills. The deal stipulated that Binance.US could invest in the instruments provided it used a third-party custodian for the funds and did not invest the customer funds back into Binance.US or Binance-related business operations.

A $3B market opportunity by 2024 end?

Research strategist Tom Wan suggests that the tokenized U.S. Treasury market is set to reach $3 billion by the end of 2024.

According to the strategist, tokenized Treasury offerings from BlackRock and Securitize will attract more capital to the tokenized U.S. debt instrument market. The analyst noted that BlackRock’s Institutional Digital Liquidity Fund (BUIDL) is already the world's largest tokenized Treasury investment fund.

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