The exchange also recently partnered with market maker Wintermute to introduce index-linked perpetuals covering crypto meme coins and layer-2 tokens.
Cryptocurrency exchange Woo X has announced the launch of a new yield-producing product it calls RWA Earn Vaults. According to the announcement, Woo X collaborated with London-based institutional tokenization firm OpenTrade to launch the product.
Per the exchange, this will be the first time a crypto exchange like itself would offer exposure to tokenized US Treasury bills to retail investors. So, it is a pioneering move on the firm’s part, and also a “significant milestone” as Chief Operating Officer Willy Chuang put it. Chuang said in an email statement:
“For the first time, retail users on a centralized exchange can instantly access an interest-bearing account backed by US Treasury Bills.”
RWA Earn Vaults (as in real-world assets) is an initiative to bridge the huge gap that exists between traditional financial securities and the ever-changing world of cryptocurrency. Chuang claims that the product will offer users a rare opportunity to engage with low-risk yet high-quality financial assets in an easier, more secure, and more efficient manner than ever before.
Woo X Jumps on the Tokenization Trend
For what it is worth, tokenization, especially that involving bank-grade assets like the US Treasuries has recently been gaining more attention in the crypto space. However, the increasing popularity may be partly related to interest rate hikes. That is because tokenized treasuries do not only offer a shield from inflation but also present an opportunity to earn yield.
To put the above into perspective, crypto investment platform Finblox revealed in 2023 its plan to offer retail users access to tokenized Treasury Bills. Coinspeaker also reported about OpenEden and more recently DigiFT launching their tokenized US treasury bills.
According to a CoinGecko report, Tokenized Treasury products have grown 782% in 2023, and are now worth over $931 million.
Possible Obstacles
As is commonly seen when new products are launched across the board, some jurisdictions and their regulators are more open-minded to innovation within their economies that enabling greater capability for the investor. On the other hand, there are regulators who are relatively hostile or sometimes slow to adopt such new products. Therefore, tokenization will not be any different and Woo X can expect some regulatory pressure and scrutiny.
Nonetheless, tokenization is relatively new in the crypto space and Woo X being one of the forerunners is poised to offer its users unprecedented yields from its latest launch.
The exchange also recently partnered with market maker Wintermute to introduce index-linked perpetual covering crypto meme coins and layer-2 tokens.
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