USDY on Sei: High-Speed Tokenized Treasuries Delivering 4.25% APY

Title: USDY on Sei: High-Speed Tokenized Treasuries Delivering 4.25% APY

Introduction Tokenized U.S. Treasuries promise stable yields for DeFi users, but on congested chains they’re often hampered by settlement delays and high fees. Today, Ondo Finance launches its United States Dollar Yield token (USDY) natively on the Sei Network, offering a reliable 4.25% APY on U.S. Treasuries with sub-second finality and on-chain settlement. This integration removes cross-chain friction and accelerates real-world asset (RWA) exposure in DeFi.

What Is USDY and How It Delivers 4.25% APY To understand how USDY achieves this yield and why Sei’s rails amplify its benefits, let’s examine its collateral model. USDY is backed by short-term U.S. Treasuries (35%) and bank demand deposits (65%), with a 3% overcollateralization buffer and a first-lien structure overseen by Ankura Trust. Updated monthly, this structure delivers a stable 4.25% annual percentage yield (APY) to non-U.S. investors globally. With over $680 million in TVL across Ethereum, Solana, Mantle, Arbitrum, and Sui, USDY blends stablecoin-like accessibility with institutional-grade protections.

Why Native Integration on the Sei Network Matters Sei is built for capital-efficient DeFi. Its Optimistic Concurrency Control engine parallelizes transactions, achieving ~400 ms block finality and thousands of transactions per second—versus 15–30 tps on Ethereum. This dramatically cuts gas costs and eliminates settlement latency. By mid-2025, Sei’s TVL surpassed $670 million (up 821% YoY), cementing its role as a leading RWA hub. Native USDY settlement on Sei unlocks high-frequency arbitrage, instant collateral management, and a seamless user experience.

Institutional Bridges and Custody Solutions for USDY Robust custody and settlement partnerships ensure institutions can efficiently access and manage USDY—here’s how each provider contributes: • Komainu (Nomura’s Laser Digital): Regulated on-chain custody for deposit-to-mint workflows.
• BitGo’s Go Network: Real-time, off-exchange settlement for 1,500+ institutions with insured custody and instant delivery-versus-payment.
• Zodia Custody and Hex Trust: Compliant, high-security safekeeping and 24/7 mint/redemption for qualified clients.

Comparing USDY to Other RWA Tokens To see how USDY stacks up in the broader RWA landscape, compare its features with similar products: • OUSG (Ondo Short-Term U.S. Government Treasuries): 4.35% APY, daily NAV, 0.15% fee (waived until July 1, 2025), structured via BlackRock’s BUIDL.
• USDY: ERC-20, quasi-permissionless for non-U.S. users, 24/7 mint/redemption, no minimum size, 3% overcollateralization, monthly yield updates, daily transparency reports by Ankura.
• sDAI (Savings [DAI](/token/dai)): ERC-4626 wrapper of MakerDAO’s rate (2–5% APY), no overcollateralization, rate subject to governance changes.

USDY stands out for its predictable yield, rigorous collateral model, and low counterparty complexity.

Earning with USDY in Sei-native DeFi Once minted on Sei, USDY can serve as: • A base-layer yield primitive in AMMs or stablecoin pools.
• Collateral in lending/borrowing protocols, leveraging sub-second finality.
• Payment rails for capital-efficient B2B settlement.

Thanks to Sei’s EVM compatibility and parallelized execution, developers can integrate USDY into any compliant dApp without code changes.

Regulatory Outlook Recent legislation bolsters USDY’s compliance profile. On July 17, 2025, the U.S. House passed the GENIUS Act, mandating 1:1 high-quality liquid asset backing, monthly reserve disclosures, and holder priority in bankruptcy. Alongside the Clarity Act, which defines oversight for non-stablecoin crypto, this framework provides the regulatory certainty needed for broader adoption of tokens like USDY.

Conclusion By combining USDY’s institutional-grade yield structure with Sei’s high-performance rails, Ondo Finance offers a scalable, low-latency vehicle for Treasury exposure. Backed by robust custody partnerships and a clear regulatory framework, USDY on Sei emerges as a compliant, transparent, and composable solution for stable-value yields in on-chain finance.