Frequently asked questions
What is the purpose of USTY?
USTY aims to provide investors with exposure to low-risk U.S. Treasury bonds through an ETF. USTY enables investors to benefit from the stability and security of U.S. Treasury bonds while leveraging the advantages of blockchain technology. USTY may appeal to investors seeking low-cost, liquid exposure to Treasuries in order to earn income and protect their portfolios from potential future volatility.
Who can invest in USTY?
USTY is available to accredited investors. Any individual or organization who wishes to purchase USTY must meet our Know Your Customer (KYC) and Anti-Money Laundering (AML) standards; these are designed to protect against fraud, corruption, money laundering and terrorist financing.
How is USTY backed?
USTY invests in an U.S. Treasury Bond ETF, which primarily consists of government-issued bonds with relatively low default risk. The ETF is managed by BlackRock, one of the world’s leading providers of investment, advisory and risk management solutions with US\$8.59 trillion in assets under management (AUM) as of December 31, 2022.
How are USTY’s value and returns generated?
USTY’s value is derived from the performance of the underlying U.S. Treasury Bond ETF. Investors receive returns based on the performance of the ETF.
How does the US Treasury bond backed ETF work?
A US Treasury bond backed ETF holds a basket of Treasury bonds, which are issued by the US government to finance its operations and debt obligations. BlackRock as the ETF manager purchases and manages the bonds on behalf of the ETF shareholders. The ETF's price is typically determined by the value of the underlying Treasury bonds in its portfolio, and it trades on a stock exchange like any other stock.
What are the risks associated with investing in USTY?
While USTY aims to invest in low-risk assets, it is essential to understand that investing in any financial instrument carries inherent risks. The value of USTY may fluctuate due to market conditions, interest rate changes, or regulatory factors. Investors should carefully assess their risk tolerance and conduct thorough research before investing. Please refer to the USTY Private Placement Memorandum (PPM) for details.
What are the benefits of investing in USTY?
Benefits of investing in USTY include the following:
- Diversification: USTY provides exposure to an ETF that offers exposure to a broad range of Treasury bonds, reducing the risk associated with holding individual bonds.
- Liquidity: ETFs can be bought and sold on stock exchanges throughout the trading day, providing investors with liquidity and flexibility.
- Transparency: The ETF's holdings are disclosed daily, allowing investors to see the bonds it holds and their respective maturities.
What costs are associated with investing in USTY?
ETFs have expense ratios, which represent the annual management fees and operating expenses of the fund. These costs are typically deducted from the ETF's assets and can vary between different ETF providers and funds. Additionally, investors may incur trading costs, such as brokerage commissions, when buying or selling ETF shares. Yieldteq charges a fee for making USTY available.
How long does it take for me to receive USDC when I redeem?
Redemption can be requested daily and typically settle within a few business days. If the Issuer has USDC available, it may service the redemption right away. Otherwise, the fund will sell the ETF shares for USD, which takes two days to settle, then transfer and swap the USD for USDC and distribute the USDC as a redemption payment.
Do I need to hold my USTY tokens in a wallet?
USTY tokens do not need to be held in a wallet. They can be held in part, or in whole in either a wallet or in a position called “TBE”. TBE stands for traditional book entry and represents your share in a book entry position rather than as digital tokens in your personal wallet. Tokens can be moved between your wallet(s) and TBE at your discretion. TBE is provided by our SEC registered Transfer Agent Securitize LLC.