What are the benefits of investing in T-Bills for users outside of the US?
US Treasury Bills are a great investment opportunity for investors in Latin America, Africa, and many other markets around the world. They offer unique value, including:
- Higher returns: US Treasury bills are considered to be one of the safest investments in the world, which means they offer higher returns than other assets. In fact, they have been called "risk-free" because they're backed by the full faith and credit of the United States government.
- Diversification: Investing in US Treasury bills can help diversify investor portfolio by adding another asset class (bonds). This reduces overall risk exposure, ensuring there will always be some fluctuations in any type of investment over time – and having more than one type will help smooth out those fluctuations.
- Hedging against inflation: T-bills provide protection from inflationary pressures; when inflation rises, typically the interest rate on bonds raises as well. This is especially attractive in locales with hyper-inflationary currencies.
- Access to a global asset: Treasury bills are the most liquid, safe and stable investment in the world. They're backed by the US government and considered one of its safest assets.
How can investors outside of the US buy T-bills?
While it is straightforward to invest in T-bills for investors in North America, it can be difficult to gain access to these assets for investors in markets such as Latin America and Africa. Typically, investors in those markets will use one of these methods:
- Working with a broker. Brokers are financial professionals who can help investors outside the US invest in US Treasury bills. Brokers can be difficult to access, and may charge a high fee for their services.
- Buying through an online platform. There are many websites that allow you to buy and sell securities online, though these sites typically have a high barrier of entry for users in emerging markets.
- Purchasing tokenized bonds: Blockchain technology allows users around the world to buy tokenized fractions of T-bills, in the form of a cryptocurrency backed by a real US Treasury Bond. With this method, users can invest in T-bills at any price point, and can move their investments into and out of the token at any time.
You can use Conduit to offer your users yield based on tokenized T-Bills with a singe API. Contact us to learn more.