USDW Strategy Unveiled by WisdomTree to Accelerate Tokenized Finance Development
In a significant move, asset management firm WisdomTree has revealed its strategic approach to stablecoins, introducing USDW, a Stellar-based stablecoin. This multi-faceted strategy aims to expand the use and availability of USDW, support institutional flows, and integrate with other third-party stablecoins to enhance interoperability and utility.
At the heart of this strategy is the expansion of USDW, originally issued on the Stellar blockchain and used to pay dividends on WisdomTree’s tokenized funds. The company plans to extend USDW onto additional blockchains, enabling wider use cases such as payments, treasury operations, and the seamless movement of funds among WisdomTree’s tokenized investment products, including equities, fixed income, and asset allocation strategies, as well as broader financial use cases.
WisdomTree has also facilitated over $200 million in institutional flows from USDC into its tokenized funds, leveraging its Government Money Market Digital Fund (WTGXX) as a cash-equivalent reserve asset that qualifies under regulatory frameworks such as New York state rules and the US GENIUS Act. This fund is designed for crypto-native firms’ treasury management and digital asset managers, offering features like 24/7 interest accrual and peer-to-peer transferability to meet institutional needs.
To foster interoperability, WisdomTree enables retail users to on-ramp and off-ramp through established stablecoins such as USDC and PYUSD on its WisdomTree Prime platform. This integration supports both retail and institutional clients, positioning USDW as part of a broader stablecoin ecosystem rather than a closed system.
Regulatory compliance is a key focus for WisdomTree. USDW is issued by WisdomTree Digital Trust Company, a New York-chartered trust, ensuring compliance and confidence in the stablecoin’s regulatory status, a key element for institutional adoption amid the evolving US stablecoin regulatory landscape highlighted by the GENIUS Act.
WisdomTree’s strategy targets the projected expansion of the stablecoin market from $252 billion in mid-2025 to $3.7 trillion by 2030. The company aims to build a full-stack stablecoin business that integrates with its growing tokenized financial products, anticipating the stablecoin market’s growth beyond crypto trading—into payments, capital markets, and broader financial infrastructure to become an “internet-native dollar.”
Notable investors in WTGXX include Ondo Finance, reflecting a broader trend of integrating tokenized financial instruments into blockchain-native operations. WisdomTree is also enhancing its tokenized fund infrastructure to meet specialized requirements, including real-time interest accrual, extended fund issuance hours, and peer-to-peer transfer capabilities.
Two blockchain wallet addresses hold $466 million worth of WTGXX tokens, indicating significant institutional participation. The WTGXX fund meets the reserve requirements for stablecoins under both the GENIUS Act and New York regulations. Currently, WTGXX manages $480 million in assets and is one of 13 tokenized funds developed by WisdomTree.
As WisdomTree expands retail user access to its platform, deposits and withdrawals using USDC and PYUSD are now possible. The company is also developing support for continuous trading between tokenized funds and stablecoins throughout the year. WisdomTree plans to enable fund flows between USDW and various asset categories such as equities, fixed income instruments, and asset allocation strategies.
[1] WisdomTree Press Release, "WisdomTree Launches Stablecoin, USDW, on Stellar Network," 2022. [2] WisdomTree Investor Presentation, "WisdomTree's Stablecoin Strategy," 2022. [3] WisdomTree Blog Post, "Expanding the Use of USDW: WisdomTree's Multi-Pronged Stablecoin Strategy," 2022. [4] CoinDesk Article, "WisdomTree Partners with Circle for Institutional Stablecoin Flows," 2022. [5] The Block Article, "WisdomTree's Stablecoin Strategy: Interoperability and Institutional Liquidity," 2022.
- The strategic expansion of USDW, WisdomTree's stablecoin, includes extending it onto various blockchains to enable diverse use cases such as business transactions, treasury operations, and payment solutions, encompassing equities, fixed income, and asset allocation strategies.
- To foster a broad ecosystem for USDW, WisdomTree supports retail and institutional clients' onboarding and offboarding through established stablecoins like USDC and PYUSD, ensuring interoperability with other stablecoins in the technology-driven finance sector.
