Author: Nancy, PANews
Tokenization is becoming one of the few narratives in this round of the crypto cycle that can make Wall Street bow down and regulators nod in agreement. In this wave of RWA enthusiasm, the tokenized asset management company Superstate, led by the 'DeFi father' and Compound founder Robert Leshner, has quietly grown into an important tokenization player based on compliance, attracting hundreds of millions in funding.
Three tokenized products have been launched, supported by hundreds of millions in funding.
Tokenization is becoming a new growth engine for the global financial market, with the trend of bringing real-world assets on-chain rapidly heating up. From concept validation to explosive growth of hundreds of billions of dollars, RWA has attracted Wall Street giants to compete for positioning. In this wave, Superstate, which was established just over two years ago, has secured a place in the tokenization market.
Superstate is another station for Leshner in the crypto industry. He is better known as the founder of Compound, which ignited the liquidity mining craze in June 2020 with its 'lending is mining' mechanism, once pushing Compound to the forefront of DeFi, with TVL peaking at several hundred billion dollars.
However, as the DeFi market continues to languish, user activity has plummeted, funds have clearly flowed out, and TVL has been declining steadily, the once-hot on-chain financial ecosystem has entered a cooling period. In this retreat, Leshner chose to leave Compound and turned to the more grounded RWA sector, founding Superstate.
As a leading figure in DeFi starting a new venture, VCs are naturally eager to invest. Superstate completed two rounds of financing in its early days, with participation from well-known institutions such as ParaFi Capital, 1kx, DRW, CoinFund, Galaxy Digital, and Hack VC, raising a total of several tens of millions of dollars.
Superstate's positioning is very clear: to develop on-chain financial products that are compliant and linked to real assets for institutional investors within the framework of U.S. financial regulation. Currently, Superstate has launched three tokenized products covering three major segments: government bonds, crypto arbitrage, and stock assets, gradually building a diversified on-chain asset portfolio.
In February 2024, Superstate launched its first on-chain fund product, USTB. On the surface, it is a short-term U.S. Treasury bond fund, but it is registered with the SEC and fully compliant, with ownership registration regulated by U.S. federal law; at the same time, its ownership records exist in token form on Ethereum and synchronize the net asset value (NAV) daily through smart contracts, allowing users to engage in on-chain subscriptions, redemptions, and trading settlements.
USTB is mainly aimed at qualified institutional investors in the U.S., supporting subscriptions and redemptions in dollars or the stablecoin USDC, with the product circulating on Ethereum, Solana, and Plume Network. Compared to traditional zero-yield stablecoins, USTB provides actual interest returns for on-chain funds while retaining the on-chain liquidity of the assets, significantly reducing the opportunity cost of capital.
This design also makes USTB the foundational yield asset for an increasing number of DeFi protocols. For instance, Frax Finance uses it as collateral for its stablecoin system, Omni Network incorporates USTB into its protocol balance sheet, Sky announced a $300 million investment for tokenized asset allocation, Arbitrum and Ethena Labs include it in their RWA investment portfolios, and the compliant stablecoin USD' uses USTB as part of its underlying support assets.
As of August 6, the asset management scale of USTB has grown to nearly $420 million, with a 7-day yield of 4.04%, ranking second among tokenized U.S. Treasury bond funds, only behind Franklin, Ondo, and WisdomTree.
After achieving significant results with its first product, Superstate struck again in July 2024, launching its second investment product, the Superstate Crypto Carry Fund (USCC). This is an on-chain crypto arbitrage fund aimed at qualified purchasers, with a core strategy based on the 'cash and carry' mechanism in traditional finance.
In traditional finance, USCC mainly focuses on the positive basis in the Bitcoin and Ethereum futures markets by buying spot assets while simultaneously selling futures contracts of the corresponding maturities to lock in the price spread gains, thereby building a risk-neutral and stable return investment portfolio. Furthermore, USCC has also integrated Ethereum staking and short-term U.S. Treasury bonds to enhance overall capital efficiency and improve portfolio resilience against volatility.
It can be said that USCC is another exploration of the integration of on-chain asset composability and off-chain compliance. As of now, USCC's asset management scale has surpassed $220 million, with an annualized strategy return of approximately 16.17%, far exceeding the industry average for traditional arbitrage products, and has established partnerships with protocols such as Morpho, Frax, Resolv, Steakhouse Financial, and Anzen.
Entering the tokenized stock space, promoting the process of tokenized compliance.
In May of this year, Superstate further expanded its product line, entering the tokenized stock arena with the launch of the new platform Opening Bell. This platform supports the direct issuance and trading of publicly registered stocks on the blockchain network, initially supporting Solana and gradually expanding to more on-chain ecosystems. Investors can directly hold and trade these compliant stock assets through cryptocurrency wallets, achieving direct interaction between traditional equity and DeFi protocols. Currently, Opening Bell has partnered with Upexi, SOL Strategies, Galaxy, and others to promote the tokenization of its stock assets on-chain.
In order to promote the adoption of tokenization in the financial market, Superstate has also launched the Superstate Industry Committee (SIC), which has so far attracted more than fifty members from both traditional and crypto sectors, including 1KX, Aave, Uniswap, Solana Foundation, BitGo, Galaxy Digital, Bitwise, Maple Finance, and Plume.
Leshner saw the trend of integration between DeFi and traditional finance as early as his time at Compound, but progress was hindered by regulatory pressures. Before officially founding Superstate, Compound had collaborated with Fireblocks and Circle to launch a fixed-rate product for enterprises and institutions called Compound Treasury, deploying USDC with a guaranteed interest rate of 4% within the Compound protocol, which at that time far exceeded U.S. Treasury yields. However, due to severe volatility in the DeFi market, declining yields, and compliance pressures, Compound Treasury ultimately announced its closure in the first quarter of 2023.
Leshner stated at the launch of Superstate, 'The main limitation of DeFi is that crypto-native assets are the only interoperable assets.' He is very optimistic about the potential of asset tokenization and has repeatedly mentioned in public that the transfer of asset ownership in traditional financial markets is a complex and inefficient process, with a lot of backend, settlement, and clearing processes involved every time there is a change in asset ownership. Tokenization is a more efficient way to record ownership, eliminating cumbersome intermediary steps and significantly reducing transaction and settlement costs. In his view, tokenization will become a core trend in the future financial market, bringing various assets such as stocks, bonds, and real estate onto the blockchain to achieve a more efficient, transparent, and compliant market structure.
At the same time, Leshner has consistently prioritized compliance as a core strategy. He believes that appropriate regulation should not be an obstacle but a tool to make DeFi more inclusive, secure, and widely accepted. The SEC's guidance in the field of crypto assets and security tokenization has gradually taken shape, with multiple guidelines released, and there may even be exemptions established. It is predicted that by the end of 2025, the securities tokenization market will truly take off in a more mature regulatory environment.
Surrounding compliance, Superstate has ramped up its efforts this year, not only registering as a transfer agent with the SEC in the U.S. with the aim of fully incorporating tokenized assets into the existing financial regulatory framework, but also actively pushing for breakthroughs in tokenization policies and industry standards. For example, a few months ago, Superstate joined forces with the newly established lobbying organization Solana Policy Institute (SPI) in Washington to submit a proposal called Project Open, advocating for the issuance and trading of securities on public blockchains and submitting proposals for related legal frameworks, arguing for the allowance of bringing traditional assets like stocks and bonds on-chain and providing specific regulatory exemptions for non-custodial blockchain protocols.
It is worth mentioning that Leshner is also actively participating in the currently popular token-stock play, such as exchanging NFT CryptoPunk #5577 for GameSquare's $5.15 million preferred stock; he also invested approximately $2.03 million to acquire a majority stake in the liquor company LQR House Inc., attempting to establish a crypto treasury plan, which once sparked a corporate control dispute.
