On August 1, OpenEden introduced the integration of tokenized US Treasury bills (T-bills) onto the XRP Ledger (XRPL).
U.S. Treasury bills, commonly referred to as T-bills, are short-term debt securities issued by the U.S. Department of the Treasury. The government utilizes these financial instruments to generate funds for various public projects and manage the national debt. T-bills are characterized by their short maturity periods, which typically range from a few days to one year. The most common maturities include four weeks, eight weeks, 13 weeks, 26 weeks, and 52 weeks.
One distinctive feature of T-bills is that they are sold at a discount to their face (par) value. This means investors purchase them for less than their eventual redemption value. For instance, you might buy a T-bill for $990 that will be worth $1,000 at maturity. Unlike traditional bonds, T-bills do not make periodic interest payments. Instead, the interest earned is the difference between the purchase price and the face value received at maturity.
T-bills are considered one of the safest investment options because they are backed by the full faith and credit of the U.S. government, making the risk of default extremely low. Additionally, they are highly liquid, meaning they can be easily bought and sold in the secondary market, providing quick access to cash if needed.
The process of acquiring T-bills involves a competitive bidding system at Treasury auctions. Investors can participate either directly or through brokers. There are two types of bids: non-competitive, where the investor agrees to accept the yield determined at the auction, and competitive, where the investor specifies the yield they are willing to accept.
Investors are drawn to T-bills for several reasons. Their safety is a primary attraction, given the backing by the U.S. government. The returns on T-bills are predictable, as the difference between the purchase price and the face value is known in advance. The high liquidity of T-bills adds to their appeal, allowing investors to convert them to cash quickly if needed. Additionally, T-bills offer a way to diversify an investment portfolio, helping to reduce overall risk.
In its press release, Ripple highlighted that OpenEden’s TBILL tokens are backed by short-dated US T-bills and reverse repurchase agreements collateralized by US Treasuries. Ripple emphasized that stringent KYC and AML screening are mandatory for all minters, ensuring top-tier security and regulatory compliance.
Ripple announced a USD$10 million investment into OpenEden’s TBILL tokens. Ripple also noted that this investment is part of a broader strategy to allocate funds to tokenized T-bills offered by OpenEden and other issuers.
Markus Infanger, Senior Vice President at RippleX, remarked that OpenEden’s tokenized US Treasury bills exemplify the tokenization trend for real-world assets, enhancing utility and creating new opportunities. Ripple emphasized that the addition of T-bills on the XRPL, powered by OpenEden, underscores the blockchain’s reputation as a leading platform for RWA tokenization.
Ripple described the XRPL as a blockchain designed for institutional-grade financial applications, lauding its reliability, efficiency, and comprehensive feature set, including an Automated Market Maker (AMM) and forthcoming capabilities like Decentralized Identifier (DID), Multi-Purpose Tokens (MPT), Lending Protocol, and native Oracle support. Ripple asserted that these features make the XRPL a robust foundation for RWA tokenization and institutional-grade DeFi.
Ripple acknowledged that OpenEden recently surpassed USD$75 million in Total Value Locked (TVL) for its tokenized US T-bills, highlighting growing market confidence. Additionally, Ripple pointed out that OpenEden’s tokenized US Treasury product is the first to achieve an investment-grade “A” rating from Moody’s rating agency.
Jeremy Ng, Co-Founder of OpenEden, expressed enthusiasm about bringing tokenized T-bills to the XRPL, facilitated by stablecoins, including the anticipated Ripple USD. Ripple noted that OpenEden’s diverse institutional client base, including foundations, corporate treasuries, and buy-side funds, underscores its stable and diversified user base.
Ripple also announced its collaboration with Archax, the UK’s first Financial Conduct Authority regulated digital asset exchange, broker, and custodian. Ripple mentioned that Archax plans to introduce hundreds of millions of dollars in tokenized RWAs to the XRPL in the coming year.
Ripple underscored that over the past decade, the XRPL has supported more than 1,000 projects, processed over 2.8 billion transactions without failures or security breaches since 2012, and maintained over 5 million active wallets with a network of more than 120 validators.
