USDY is trading around $1.1172 right now, down roughly 4.4% over the last day. That might not sound like much for crypto, but for a tokenized Treasury product that’s supposed to track yield rather than speculation, it’s enough to raise eyebrows. Daily volume is still pretty light—under $2 million—which means even small trades can push the price around more than you’d expect.
The asset itself is built on a straightforward premise: it’s backed by short-term U.S. Treasuries and offers an APY hovering near 4.25%. That’s appealing if you’re looking for yield without leaving the blockchain. Ondo has been pushing into new ecosystems too, recently expanding onto the Sei network, which speaks to growing institutional interest in real-world assets (RWAs) that live on-chain.
What the Technical Picture Shows
USDY recently slipped below its 7-day moving average, which sat around $1.12, and is now testing a more meaningful line of support: the 200-day exponential moving average near $1.11. If that level gives way, the next logical stop is around $1.08, and possibly lower if selling picks up.
Momentum indicators aren’t offering much clarity. The RSI is sitting near neutral territory—around 50 to 55—so there’s no strong signal that a bounce is imminent. The MACD is similarly muted, with shrinking histogram bars that suggest the recent momentum is fading rather than building.
On the upside, $1.12 is the first hurdle. If USDY can reclaim that level with some conviction, the next resistance sits around $1.14, near recent highs. But with volume this thin, it’s hard to say whether buyers will step in or whether we’re just seeing random noise.
Three Scenarios Worth Watching
The Steady State
If USDY holds above $1.11 and the broader appetite for tokenized Treasuries stays intact, we could see a gradual climb back toward $1.12 or $1.13. Volatility would likely stay low—maybe half a percent up or down on any given day. Over the next month or two, a push toward $1.14 isn’t out of the question, especially if more platforms start using USDY as collateral or if integrations across other chains pick up steam.
The Breakdown
If $1.11 cracks with volume behind the move, things could get messier. A drop to $1.08 or even $1.05 becomes realistic, especially if regulatory pressure mounts on yield-bearing stablecoins or if liquidity dries up in the RWA space. USDY plays a role as collateral in certain DeFi protocols, so any stress in those systems could amplify the decline.
The Bullish Case
On the flip side, if demand for tokenized Treasuries heats up—maybe driven by institutions hunting for yield or favorable shifts in regulation—USDY could break through $1.12 and target $1.14 to $1.16 over the next few weeks. Looking further out, if total value locked keeps climbing and USDY becomes more widely accepted as collateral, a move toward $1.20 in the next three to six months isn’t impossible. But that would require both liquidity and use cases to expand without diluting the Treasury backing.
What This Means for Traders and Holders
If you’re trading this, the levels to watch are simple: $1.11 is support, $1.12 is resistance. A clean bounce off support with volume could be an entry signal. A break below with follow-through? That’s a warning to lighten up or stay on the sidelines.
For longer-term holders drawn to the yield aspect, keep an eye on regulatory developments in the U.S., especially around stablecoin oversight. USDY’s value proposition hinges on its Treasury backing and its growing role across DeFi protocols. How it’s integrated as collateral, whether it expands to more chains, and whether total value locked continues to grow—those are the metrics that matter more than day-to-day price wiggles.
Liquidity is still a risk. Low volume means big moves can happen fast, so position sizing and stop levels are worth thinking through carefully.
