Littio Transitions to Avalanche for Crypto-Backed U.S. Treasury Investments, Achieving $80 Million in Trading Volume

Littio, a Colombian neobank, is making it easier for customers to invest in U.S. Treasury bills through crypto products. They’re switching their vault holdings from Ethereum (ETH) to Avalanche (AVAX) to improve scalability. Since launching in February, they’ve already achieved an impressive trading volume of $80 million.

Why the switch? The demand for Yield Pots is on the rise. These products allow users to earn interest on their U.S. dollar deposits. Avalanche was chosen for its low transaction fees and reliability. Last year, the Avalanche Foundation launched a $50 million program to promote the development of real-world assets on its blockchain, which is a big win for the platform.

Littio offers Yield Pots through a partnership with OpenTrade, a London-based firm that specializes in yield-bearing products using stablecoins and real-world assets like U.S. Treasury bills. Stablecoins are cryptocurrencies designed to maintain a stable value, usually pegged to the U.S. dollar. Real-world assets are tangible assets, like real estate, that exist outside the crypto space but are represented on the blockchain as digital tokens.

According to Jeff Handler, chief commercial officer at OpenTrade, “Currently, Littio is the only Latin American neobank using our vaults, but we have more clients set to come online this year, offering different types of USDC-based fintech services.” He added that their clients mainly include neobanks, centralized exchanges, and payment companies that use USDC to meet the demand for USD bank accounts and services across Latin America.

Littio operates in several Latin American countries, including Colombia, Argentina, El Salvador, Brazil, and Mexico. Even though Yield Pots just launched in February, they’ve recorded over $80 million in transaction volume and provided users with $250,000 in returns over the last four months. Littio typically holds and reinvests between $11 million and $13 million in OpenTrade vaults each month, according to Handler.

For comparison, Franklin Templeton, a major U.S. financial institution, has a tokenized money market fund that allows users to invest in U.S. Treasuries, amassing $435 million in assets since its launch in 2021. The yield from Littio’s vaults ranges from 2% to 5%, as noted on their website.

This product appeals to many because the Colombian peso has lost over 54% of its value against the U.S. dollar in the last decade and 88% since 1990. Other Latin American currencies are also struggling with inflation, making the U.S. dollar an attractive option. Additionally, Littio customers may face currency restrictions or have difficulty accessing traditional banking services, further motivating them to sign up.

As Morgan Krupetsky, head of institutions and capital markets at Ava Labs, which develops the Avalanche blockchain, puts it, “Littio and OpenTrade exemplify how Avalanche’s technology can enable underbanked populations to access compelling products and services that are otherwise unavailable or untenable via traditional rails.”