Key Highlights
- VBILL can now be used as collateral in Aave’s Horizon market, linking U.S. Treasury-backed tokens with on-chain lending systems designed for institutions.
- Users can loop deposits and borrows to increase yield, but the strategy depends on VBILL’s return staying above RLUSD borrowing costs, and it carries liquidation risks.
- The setup uses Chainlink’s NAV oracle and Securitize’s infrastructure to verify pricing and enable instant issuance, aiming to keep operations transparent and compliant.
The leading Investment firm, VanEck, has linked its tokenized U.S. Treasury fund, VBILL, to Aave’s Horizon Real-World Asset (RWA) Market on Ethereum. This move connects a traditional fixed-income product with a blockchain lending system.
According to a blog post by Securitize, the firm facilitating infrastructure for the VBILL, this integration allows the fund to be used as collateral inside Aave’s permissioned marketplace. It allows institutions to use VBILL within decentralized finance (DeFi) and opens the door to new ways of earning yield using familiar assets.
Carlos Domingo, Founder and CEO of Securitize, confirmed on X, “Today, we announced the first tokenized asset issued by Securitize approved to be supplied as collateral at Aave Horizon RWA marketplace, vaneck_us VBILL product using chainlink as oracle to supply the price feed into Horizon.” Domingo also noted that Horizon could eventually surpass Aave’s main market, citing the superior collateral quality that real-world assets offer.
VBILL: Bridging traditional finance and DeFi
Launched in May 2025, VBILL reflects shares in the VanEck Treasury Fund, which holds short-term U.S. Treasury bills and related cash-like assets. Each token is meant to stay near a $1 value and distributes yield each day. This creates an on-chain way to access returns tied to Treasury holdings. The fund runs on several blockchains, including Ethereum, Solana, BNB Chain, and Avalanche, with Wormhole used to move tokens between them.
According to Aave data, VBILL currently has a liquidity of $9.17 million and a 7-day yield of 3.93%, while borrowing RLUSD costs around 2.84%. This difference creates room for yield strategies. A user can deposit VBILL as collateral, borrow RLUSD, and then reinvest those funds to increase their overall return.
This setup makes it possible to repeat the process more than once. A user can deposit VBILL, borrow RLUSD, exchange it for USDC, buy more VBILL, and then deposit it again. Each round increases the amount of VBILL earning yield. After one cycle, the estimated return is about 4.84%. With additional cycles, the return could rise to around 5.5%, depending on market conditions.
Technology powering the integration
The VanEck Treasury Fund (VBILL) is officially listed on Aave Horizon as a qualified collateral asset, VanEck stated on Thursday. According to the blog from Securitize, it relies on the Chainlink NAVLink oracle to determine the current value of the VBILL. The Securitize DS Protocol enables instant on-chain buying of new VBILL tokens, meaning that users can complete the cycle without any delays.
VanEck has also added that, later on, price accuracy will be improved with the addition of Securitize’s Trusted Single Source Oracle. The Horizon market uses a permissioned setup; it allows only approved participants to access it, enabling institutional compliance while activity is still visible on-chain.
According to Kyle DaCruz, Director of Digital Assets Product at VanEck, “Institutional investors can now leverage the safety and transparency of tokenized Treasuries while accessing the efficiency and composability of DeFi.”
Opportunities and risks
This integration highlights how tokenized Treasuries could become a key provider of on-chain liquidity. The approach works only for as long as the return from VBILL stays higher than the cost of borrowing RLUSD. If the yields on the Treasury fall or borrowing rates go up, the differential between the two could shrink and thus lower potential returns.
Leveraged strategies also amplify risks, including liquidation during volatile market conditions or price fluctuations below $1 per VBILL. Hence, while the setup enhances returns, it also requires careful risk management and collateral monitoring.
Why this matters
VanEck and Securitize are bringing regulated real-world assets into a DeFi environment. By placing U.S. Treasury-backed tokens on-chain and allowing them to be used as collateral, they are creating a bridge between traditional markets and blockchain-based liquidity systems.
This setup offers a clearer framework for how institutional capital may interact with decentralized markets going forward, with more transparency and defined collateral mechanics.
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