Circle, the crypto company behind the $48 billion USDC stablecoin, announced Tuesday that it has acquired tokenized real-world asset (RWA) issuer Hashnote.
The companies closed the deal this morning, a Circle spokesperson told CoinDesk, and was announced in Davos, Switzerland, at the World Economic Forum’s annual meeting. The companies did not reveal pricing details.
Circle aims to integrate USYC with USDC, Circle’s flagship stablecoin, enabling cross-cash convertibility and yield-producing guarantees on blockchains, the press release states. Hashnote issues the $1.3 billion USYC token, which saw massive growth last year to become the largest tokenized U.S. Treasury product on the market, according to data from rwa.xyz.
Circle CEO Jeremy Allaire said this marks an important step toward aligning traditional financial structures with the speed and transparency of blockchain-based markets.
“This is a huge opportunity for a market that is increasingly driven by institutional adoption and where participants increasingly expect market structures common to TradFi,” Allaire said.
Circle shared its plans to go public a year ago, and the crypto industry widely expects the public stock offering to take place later this year.
Tokenization and stablecoins
The acquisition highlights the synergies between two of the hottest trends in crypto: stablecoins and tokenization. Circle’s main stablecoin competitor, Tether, launched a tokenization platform last year.
Stablecoins, a $200 billion cryptocurrency asset class whose prices are primarily tied to the U.S. dollar, are a crucial piece of infrastructure in tokenization efforts. They are used as a bridge between fiat currency and digital assets and are widely used to settle transactions on blockchain tracks.
Tokenized RWAs like Treasury bills and money market funds are quickly gaining traction among sophisticated investors and asset managers as collateral for transactions. Unlike traditional markets, blockchain-based assets promise transparency, accessibility, and round-the-clock settlements. Treasury-backed tokens also allow investors to earn a return when deposited as collateral or margin for transactions, thereby improving returns compared to transactions backed by fiat currency or stablecoins.
For example, Singapore-based hedge fund QCP Capital executed a bitcoin (BTC)-based trade earlier in January using BUIDL, the money market fund token issued by BlackRock and Securitize.
USDC in Guangzhou
Circle also announced that it has entered into an agreement with Cumberland, a cryptocurrency trading firm and market maker affiliated with DRW, to provide liquidity and facilitate settlements for USDC and USYC. The partnership aims to expand USYC as a form of collateral across exchange and custodial platforms.
Additionally, Circle outlined plans to deploy USDC on the Canton Network, a blockchain used by traditional financial institutions for real-world asset transactions. The integration with Canton would enable consistent liquidity between cash and collateral and enable seamless transfers between decentralized and traditional markets.
