Crypto Exchange Woo X Claims a First With Tokenized Treasury Bills for Retail Investors

BY Coindesk | TREASURY | 04/22/24 05:04 AM EDT By Ian Allison
  • Crypto (CRCW) exchange Woo X says this is the first time tokenized T-Bills will be available to retail customers.
  • The exchange recently began offering index-linked meme-coin perpetuals with market maker Wintermute.

Woo X is claiming bragging rights for being the first cryptocurrency exchange to offer retail customers exposure to tokenized U.S. Treasury bills.

The yield-bearing product, unveiled on Monday, called RWA Earn Vaults (as in real-world assets) has been built in partnership with London-based institutional tokenization platform OpenTrade. The product's arrival was described as a ?significant milestone? by Woo X Chief Operating Officer Willy Chuang.

?For the first time, retail users on a centralized exchange can invest in USDC real-world asset vaults, with U.S Treasury Bills as the underlying assets,? Chuang said in an email. ?This initiative bridges a crucial gap between traditional financial securities and the dynamic world of cryptocurrency, offering our users an unprecedented opportunity to engage with low-risk, high-quality financial assets in a seamless, secure, and efficient manner.?

Tokenization ? especially involving bank-grade assets like U.S. Treasuries ? has become popular, partly in response to interest rate increases, and now dovetailing with the current crypto bull run. Last year, crypto investment platform Finblox said it was planning to offer retail users access to tokenized T-Bills.

OpenTrade has links to Center, the now-dissolved collaboration between USDC issuer Circle, and, going further back, the Marco Polo enterprise blockchain project.

Woo X recently introduced index-linked perpetuals covering crypto meme coins and layer-2 tokens, in association with market maker Wintermute.

In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible.

Lower-quality debt securities generally offer higher yields, but also involve greater risk of default or price changes due to potential changes in the credit quality of the issuer. Any fixed income security sold or redeemed prior to maturity may be subject to loss.

Before investing, consider the funds' investment objectives, risks, charges, and expenses. Contact Fidelity for a prospectus or, if available, a summary prospectus containing this information. Read it carefully.