The tokenization of real-world assets (RWAs) is drawing sustained interest from global institutions, because of what’s being tokenized: yield.
87% of all tokenized real-world assets are already income-generating, with $7.4B in Treasuries and $15.6B in private credit on-chain today, and this is only the beginning of a $3T private credit and $29T Treasury market waiting to migrate. After many years of securing licenses and building compliant infrastructure, IXS is perfectly positioned to be the institutional gateway as yield becomes the unstoppable driver of tokenization.
From U.S. Treasuries to private credit, income-generating assets have become the driving force behind institutional engagement with blockchain infrastructure. Tokenization isn’t replacing how financial instruments work; it’s offering a new way to package, distribute, and manage them.
This article breaks down why yield-bearing assets are leading the charge, what types of trends are emerging, and what institutions should watch as the landscape evolves.
Income-Generating Assets Dominate Tokenized Value
According to RWA.xyz, approximately 87% of the total value locked (TVL) in tokenized RWAs today comes from income-generating assets. They are mainly U.S. Treasuries and private credit.
Here’s what the data tells us (as of August 2025):
- Tokenized Treasuries: $6.6B in value, led by issuers like BlackRock (BUIDL), WisdomTree, and Ondo Finance ($USDY).
- Private Credit: $15.6B in tokenized notes and structured credit, often offering 8-12% target yields.
This dominance is understandable because institutions are already familiar with these products. And in a high-rate environment, they’re looking for efficient ways to deploy capital across fixed income strategies.
How Tokenization Works in Simple Terms
In a tokenized model, the issuer still originates the underlying security. Legal protections, cash flows, and documentation all remain as they would off-chain. The key difference is that ownership is represented on-chain through digital tokens. These tokens can then be settled, traded, and managed using blockchain infrastructure - either through permissioned smart contracts or integrated platforms.
Here’s a simplified flow:
- An issuer (e.g., fund manager or credit provider) creates a legal structure to hold the underlying asset.
- A digital token is minted to represent ownership or entitlement to returns from that structure.
- Investors purchase the token, often using stablecoins, and earn income based on the performance of the underlying asset.
- Cash flows are distributed directly to wallet addresses or custodians, depending on the setup.
These tokenized structures aren’t meant to replace traditional securities but to give them better infrastructure for issuance, settlement, and ongoing lifecycle management.
Two Tokenized Yield Strategies Are Emerging
As tokenization expands, two distinct use cases have begun to take shape: tokenized treasuries and tokenized private credit. Each driven by a different market need. Together, these trends represent a new yield stack that combines the predictability of traditional yield-generating instruments with the flexibility of blockchain.
1. US Treasuries: Capital Preservation with Liquidity
This includes tokenized U.S. Treasuries and money market funds, which institutions use to:
- Park stablecoin reserves or corporate cash into secure, short-duration yield
- Maintain compliance with treasury management mandates
- Earn 4-5% APY with high liquidity and minimal duration risk
Example products:
- Ondo’s tokenized U.S. Treasuries (OUSG) and short-term notes
- Franklin Templeton’s on-chain MMF shares
- InvestaX’s MMF Earn product linked to Fidelity USD MMF
- IXS’s tokenized BlackRock High Yield Corporate Bond Vault
According to RWA.xyz, tokenized Treasuries have grown 3.3x year-on-year, largely due to demand from on-chain funds, centralized desks, and corporates looking to generate yield without compromising liquidity.
2. Private Credit for Higher-Yield, Structured Deployment
Private credit is emerging as the second pillar of tokenized yield strategies. These instruments offer:
- Higher risk-adjusted returns (often 8–12%)
- Access to SME financing, real estate debt, or asset-backed lending
- Structures that don’t exist in traditional public markets
Today, over $3.2 trillion sits in private credit globally. Tokenization enables smaller deal sizes, fractional ownership, and a broader distribution base, especially across digital-native capital.
Why Institutions Are Paying Attention
Tokenized income-generating assets offer several practical advantages:
- Stable, transparent yield: Unlike volatile DeFi returns, tokenized Treasuries and private credit offer predictable cash flows and risk-adjusted returns.
- Lower operational friction: Intermediaries often increase cost and complexity. Tokenization removes layers while preserving compliance.
- Collateral utility: Tokenized MMFs and Treasuries are increasingly used as collateral in both CeFi and DeFi workflows, improving capital efficiency.
The proof points are growing:
- BlackRock’s BUIDL token supports same-day redemptions.
- Standard Chartered and OKX now use tokenized MMFs as collateral in off-exchange settlements.
- MakerDAO holds hundreds of millions in tokenized Treasuries to back stablecoins.
Beyond yields, tokenized RWAs offer institutions control, visibility, and infrastructure upgrades without reinventing the product itself.
Final Notes
"As trillions in fixed-income assets transition onto blockchain rails, only platforms with regulatory moats, liquidity engines, and proven issuance frameworks will capture the flow. The world is just waking up to tokenized yield, but IXS has been preparing for this exact moment, making the next phase of institutional adoption not a question of if, but through whom."
Yield remains a key anchor in institutional portfolios. As the market matures, it’s the familiar yield-generating instruments, including Treasuries, private credit and structured notes that are leading adoption.
Tokenization allows these products to be issued, accessed, and managed with greater efficiency.
Interested in issuing tokenized yield strategies? Contact IXS to get started.