Circle USYC (USYC)

Overview

A fund share on a blockchain

Circle USYC (USYC) is a digital token that represents a share of the Hashnote International Short Duration Fund Ltd. The fund invests in short-term U.S. Treasury bills and reverse repurchase agreements backed by U.S. government securities. In simple terms, an eligible institution can hold a fund interest in a blockchain wallet and move between that interest and USDC, Circle’s digital dollar, through an onchain process. (circle.com)

USYC is designed mainly for institutional treasury and trading. A firm may want to hold a yield-bearing asset while keeping it available for collateral or later conversion into USDC. The token brings fund ownership into the same digital systems that institutions use to transfer assets and settle transactions. Access is limited to eligible non-U.S. persons and requires onboarding. (circle.com)

History & Team

From Hashnote to Circle

Hashnote developed USYC as a way to bring a short-duration investment fund onto blockchain networks. Hashnote was incubated by Cumberland Labs, and its founder and chief executive was Leo Mizuhara. In January 2025, Circle announced its acquisition of Hashnote. The deal brought USYC into Circle’s wider group of digital-asset products alongside USDC. (circle.com)

Circle’s plan linked two different tools: USDC for moving digital dollars and USYC for holding a tokenized, yield-bearing fund interest. After the acquisition, Circle expanded USYC’s role in institutional collateral and added support across more blockchain networks. The fund remains the source of the token’s investment exposure; putting its shares onchain changes how eligible holders can record and transfer that exposure. (circle.com)

Technology & How It Works

Connecting the fund register to wallets

USYC uses a permissioned token system. Before an institution can hold it, the institution completes identity and compliance checks, and an approved wallet address is added to an allowlist. When an eligible investor subscribes with USDC, tokens are issued to that wallet to represent the corresponding fund shares. A fund administrator maintains the share register and reflects token movements in its records. Smart contracts check permissions before allowing transfers between wallets. (help.circle.com)

Each token’s fund value is tied to net asset value, or NAV: the value of the fund’s assets after its obligations are taken into account. An onchain oracle publishes information used to report USYC’s value. The fund’s investment activity takes place in traditional financial markets, while the token provides an onchain record that approved applications can read and use. This links a managed investment portfolio with programmable transfers. (help.circle.com)

Circle lists USYC on Arc, BNB Chain, Canton, Ethereum, NEAR, and Solana. Its listed token standards include ERC-20 and Solana’s SPL-22. A transfer on one of these networks changes the token’s onchain holder, subject to the fund’s eligibility controls. Network support gives institutions several places to integrate USYC into their systems; it does not remove the onboarding requirement. (circle.com)

Tokenomics & Utility

Supply follows subscriptions

USYC’s economic model follows ownership of fund shares rather than a fixed token-allocation schedule. Subscriptions create tokens corresponding to newly held shares, while redemptions exchange eligible holdings for USDC and update the fund’s records. The number of tokens an investor receives depends on the subscription amount and the applicable value per token. This keeps token issuance connected to the underlying fund interest. (help.circle.com)

The fund earns returns from its short-term securities and reverse repurchase activity. Net earnings are reflected through the value of each USYC token rather than through staking rewards that holders must claim. Circle lists subscription, redemption, and performance fees in its product terms. These fund mechanics matter because a holder’s return comes from the managed portfolio, while the blockchain supplies the method for recording and using the holding. (circle.com)

USYC’s main utility is as a fund interest that can also serve as collateral where an institution accepts it. An approved holder can retain exposure to the fund until it needs USDC for another transaction. Circle offers around-the-clock redemption requests; the time needed to complete a redemption depends in part on the amount requested and the available instant-redemption capacity. Larger requests may settle on the same or following business day. (circle.com)

Ecosystem & Use Cases

Treasury and collateral

A treasury team can use USYC to hold part of its available capital in a short-duration fund, then redeem into USDC when it needs digital dollars. An institutional trader may instead use approved USYC holdings as collateral. Both uses depend on the same feature: the fund interest can be recorded and moved through onchain systems while remaining connected to the fund’s share register. (circle.com)

One established example is Circle’s collaboration with Binance. Binance institutional clients can use USYC as yield-bearing, off-exchange collateral for derivatives trading through supported custody arrangements. Circle has also described USYC’s use in lending desks and other collateral workflows. These integrations make the token useful beyond simply holding a fund share, although each platform sets its own access and operating requirements. (circle.com)

For developers, USYC provides a fund asset that approved applications can account for within automated workflows. A system can read onchain balances and oracle data when managing subscriptions, redemptions, or collateral. Its permission checks are part of the design, so applications must work with eligible institutions and approved wallets. (circle.com)

Advantages & Challenges

Speed within a managed-fund structure

USYC combines features that usually sit in separate systems. Blockchain records make token movements visible, smart contracts can automate parts of a workflow, and conversion into USDC can help an institution move from a fund holding to a digital settlement asset. The token also lets an approved holder use a yield-bearing fund interest as collateral on participating platforms. (circle.com)

That design has practical limits. The portfolio is managed through financial-market processes, even though the token moves on a blockchain. Its reported value is updated through an oracle, and the fund’s investment activity follows the calendar for those markets. Redemption speed also varies with available capacity. In addition, permissioned transfers require both the holder and receiving wallet to meet the fund’s rules. These features shape where USYC can be integrated and who can use it. (help.circle.com)

Where to Buy & Wallets

Institutional access

USYC is available through Circle’s USYC Teller for approved investors. Eligible institutions subscribe using USDC after completing onboarding and connecting an approved wallet. The Teller also allows approved holders to redeem USYC for USDC. Circle lists a $100,000 investment minimum on its USYC product page. Binance supports USYC for eligible institutional collateral use through its announced arrangement with Circle. (help.circle.com)

USYC can be held in a compatible wallet on a supported network once that wallet has been approved for the fund. Ethereum-style implementations use an ERC-20 token, while the Solana implementation uses SPL-22. Wallet compatibility alone does not grant access: the institution and wallet must pass the required checks before they can hold or receive tokens. (circle.com)

Regulatory & Compliance

Fund ownership and eligibility

Each USYC token represents an interest in a Cayman Islands mutual fund. Circle International Bermuda Limited serves as the fund’s token administrator and holds a digital-asset business license from the Bermuda Monetary Authority. Circle describes the underlying fund as regulated by the Cayman Islands Monetary Authority. These roles connect the onchain token to a legal fund and its ownership records. (circle.com)

The fund’s shares and USYC are available only to eligible non-U.S. persons under the offering’s stated rules. Holders must complete identity and anti-money-laundering checks, and approved wallet addresses receive permission to hold and transfer the token. The smart-contract system also screens addresses against sanctions information. These controls apply to the token even when a transfer takes place on a public blockchain. (circle.com)

USYC’s investment approach does not align with conventional shariah principles that prohibit riba, or interest. Its portfolio includes Treasury bills and reverse repurchase activity that generate interest-based returns. Shariah standards published for Islamic finance prohibit receiving interest as an investment return, so the fund’s underlying assets are central to its religious-finance status. (help.circle.com)

Future Outlook

More connected capital markets

USYC shows one way a traditional fund can take part in blockchain-based finance. Circle has identified onchain treasury, collateral, and capital-markets workflows as areas for further USYC integration. Support across several networks also gives approved institutions and developers more settings in which to build those workflows. (circle.com)

Its longer-term role will depend on useful integrations with trading venues, custodians, and institutional applications. The core task remains the same across those settings: linking a legally recorded fund interest to a token that eligible participants can transfer, track, and redeem. (help.circle.com)

Summary

Circle USYC represents shares in a short-duration fund through permissioned blockchain tokens. It gives eligible non-U.S. institutions a way to hold a yield-bearing fund interest, use it in supported collateral arrangements, and redeem it for USDC. Its place in the crypto ecosystem is at the meeting point of managed funds and programmable digital-asset infrastructure. (circle.com)