Circle has moved the fund behind its USYC tokenized money market product from predominantly overnight reverse repos into longer-dated U.S. Treasury bills, leaving its token and redemption arrangements unchanged.
Summary
- Circle moved USYC’s underlying fund from predominantly overnight reverse repos into longer-dated U.S. Treasury bills.
- USYC retains its existing token, issuer, and USDC subscription and redemption processes following the change.
- USYC remains available for eligible institutional investors to use as collateral for derivatives trading positions.
- Circle acquired Hashnote in January 2025, bringing the USYC tokenized money market product into its business.
Circle announced the change on November 9, saying USYC will retain the same issuer, token, and subscription and redemption processes using USDC. The company did not provide the fund’s updated weighted average maturity, current yield, or the proportion of assets moved into Treasury bills.
Circle’s USYC fund now holds longer-dated Treasury bills
The change alters how the underlying fund invests its assets. Previously, the portfolio relied primarily on overnight reverse repurchase agreements, which generally involve lending cash against securities for short periods.
Under its updated structure, the fund invests in U.S. Treasury bills with maturities of up to six months, according to Circle’s product information. Treasury bills pay returns through the difference between their purchase price and face value at maturity.
Longer maturities allow investors to retain the yield available when the securities are purchased until they mature. However, Treasury bill prices can change before maturity as market interest rates move, with longer maturities generally carrying more interest-rate exposure.
crypto.news contacted Circle for comment but the company had not responded by press time.
USYC subscriptions and redemptions remain unchanged
Despite the changes to the underlying portfolio, Circle said investors will continue using USDC to subscribe to and redeem USYC. The company has not announced changes to the token’s issuer or existing operational arrangements.
USYC represents shares in the Hashnote International Short Duration Fund Ltd., a Cayman Islands registered mutual fund. Circle International Bermuda Limited serves as its token administrator under a Bermuda Monetary Authority digital asset business license.
Unlike USDC, USYC is a yield-bearing investment product whose returns accumulate through changes in its token price. Investors therefore receive exposure to the fund’s underlying investments without collecting separate interest payments.
Circle states that redemptions within the available instant-redemption capacity can settle onchain within one block. Requests above that capacity generally settle on the same business day or the next business day, although separate liquidity arrangements are available.
The product requires a minimum investment of $100,000. Circle lists standard subscription and redemption fees of 0.04% and 0.03%, respectively, with those charges waived on the first $1 million in qualifying combined daily volume.
A performance fee equal to 10% of yield applies. Access remains restricted to eligible non-U.S. persons, and Circle lists Ethereum, Solana, BNB Chain, NEAR, Canton, and Arc among its supported networks.
USYC remains available for institutional trading collateral
The portfolio change concerns a product that institutional traders can use as collateral for derivatives positions. Circle has previously arranged for USYC holders to pledge their tokens while retaining exposure to the fund’s investment returns.
In July 2025, crypto.news reported on the Binance collateral integration, which allowed eligible institutional customers to use USYC as off-exchange collateral for derivatives trading.
The arrangement uses custody and triparty infrastructure, allowing participating institutions to maintain collateral outside the exchange’s direct custody. Circle said the structure supported USYC conversions into USDC when liquidity was required.
Circle’s announcement did not specify whether the revised Treasury holdings would change collateral valuations, margin requirements, or redemption arrangements at participating trading venues. It provided no details about any notification process involving exchanges that accept USYC.
The company has continued expanding its institutional relationship with Binance. An October agreement between Binance and Circle included a $100 million investment and a five-year USDC arrangement, following their earlier cooperation involving stablecoin services and USYC collateral.
Circle expanded its tokenized fund business through Hashnote
Circle acquired Hashnote in January 2025, bringing its tokenized money market business into the company’s existing stablecoin operations. The Hashnote acquisition announcement identified USYC as an institutional product linked to short-term government securities.
In March 2025, Circle announced plans to bring the fund under its existing Bermuda digital asset business license. At the time, the company said the integration would connect USYC with USDC for institutional subscriptions and redemptions.
Circle’s published figures show USYC held approximately $313 million in assets under management as of October 27, 2026. The fund began operations in January 2023, before Circle acquired Hashnote.
According to the company’s product documentation, USYC token balances, prices, and yield information are available through an onchain oracle feed.
