Government Bonds RWA: Current Development Status and Future Outlook

In the current crypto market environment, treasury bond RWA projects are rising rapidly, becoming the sub-category with the most potential to achieve scale and user explosion in the short to medium term. According to the data, the tokenized assets of treasury RWA projects have approached $700 million, an increase of about 240% from the beginning of the year. At the same time, some large DeFi projects such as MakerDAO have also included US bonds in their investment scope, and the scale of their treasury bond RWA has reached the level of billions of dollars.

The Significance of Government Bonds RWA

The introduction of RWA in government bonds brings the concept of risk-free interest rates from traditional financial markets to the crypto world, which is significant for investors:

1. Provide a stable income place for U-based investors during a bear market.
2. Promote the launch of hybrid financial products and drive innovation in the DeFi asset management sector.
3. Provide stable income sources for DeFi projects to improve profitability.

Mainstream Business Models

Currently, there are five main business models for government bond RWAs:

1. Consignment model: Focus on customer acquisition, marketing, and scenario expansion
2. Platform Model: Provides services such as on-chain, sales, KYC, etc.
3. Infrastructure Model: Providing services such as RWA on-chain and asset management.
4. Self-operated model: Self-package assets and tokenize
5. Hybrid Mode: A combination of the various modes mentioned above.

Underlying Assets and Architecture

Common types of underlying assets include:

1. US Treasury Bond ETF
2. U.S. Treasury Bonds
3. A combination of US Treasury bonds, government agency bonds, and reverse repos

The asset business architecture mainly includes:

1. Trust Structure
2. Limited Partnership SPV Structure
3. Lending Platform + SPV Architecture
4. On-chain Fund Shares

User Requirements

The project's requirements for users mainly focus on the following aspects:

1. Minimum investment amount: Some projects have no restrictions, while others set a threshold of over $100,000.
2. KYC requirements: ranging from no KYC to heavy KYC.
3. Regional Restrictions: Some projects have restricted service areas.

Profit Distribution and Composability

There are mainly two types of profit distribution strategies:

1. Direct allocation of underlying asset income
2. Adjusting through deposit interest rates

Composability:

• The composability of strict KYC projects is relatively low.
• Non-KYC projects have no significant restrictions on composability.

! [Why have government bonds become the only foothold for short- and medium-term RWA?] ](https://img-cdn.gateio.im/webp-social/moments-984468ce16be3f9da4210ce3d67c27fa.webp)

Future Development Trends

1. Choosing government bond ETFs as the underlying asset is relatively convenient.
2. The business architecture needs to be scalable.
3. Projects without KYC and with no thresholds have a broader user base.
4. Yield rates that align with government bonds are more popular.
5. Expanding application scenarios is beneficial for achieving a larger business scale.

With regulatory intervention, lightweight KYC projects may have more advantages in the medium to long term.