Tokenization of Real-World Assets: Trends, Challenges, and Potential

Recently, the tokenization of real-world assets (RWA) has become an irreversible trend. From trading platforms planning to launch tokenized stocks to cryptocurrency exchanges intending to put stocks on the blockchain; from the proactive positioning of traditional financial giants to leading DeFi protocols incorporating RWA into the collateral framework—tokenization is fundamentally reshaping the liquidity and accessibility of assets.

Despite facing challenges in regulation and infrastructure, the RWA sector has shown great potential: the total locked value of tokenized assets such as U.S. Treasury bonds, real estate, luxury goods, etc., (TVL) has surpassed billions of dollars. According to data platforms, the total on-chain managed value of the RWA market has reached 23.92 billion dollars to date. According to a forecast by the Boston Consulting Group, the global scale of tokenized assets will reach 16 trillion dollars by 2030, accounting for 10% of all investable assets.

This article will analyze the current most promising RWA sub-sector and review the most representative leading projects in various fields.

Tokenization of National Bonds: Enhancing Liquidity and Transparency

Tokenization of government bonds is an important innovation in the financial market, transforming traditional government bonds into tokens, allowing investors to participate in government bond investments directly through blockchain, enjoying higher liquidity and transparency.

A certain asset management company has launched the world's first registered tokenized money market fund, FOBXX, which invests in U.S. government securities, providing investors with stable returns and liquidity.

A certain company launched the tokenization of U.S. Treasury bonds (TBILL) through the XRP Ledger and secured an investment of $10 million. By tokenizing TBILL, the trading of Treasury bonds becomes more decentralized, enhancing capital liquidity.

A certain company has launched short-term U.S. Treasury Tokens (STBT), which allocate interest to holders daily through an on-chain benchmarking mechanism, providing investors with a short-term liquidity tool.

A company has launched a tokenized U.S. Treasury bond fund (USTY) in partnership with partners, aimed at qualified investors. The fund's operations are managed through smart contracts, supporting the tokenization of the Treasury bond fund and enhancing investment transparency.

A certain company has launched a short-term U.S. government securities fund (USTB), providing liquidity through a tokenization format. This allows investors to conduct fast and efficient transactions on the blockchain.

A certain company has launched the USYC Token, representing short-term U.S. Treasury bonds and repurchase agreements, providing investors with low-risk, high-liquidity investment products.

A certain asset management giant has launched the tokenized national debt fund BUIDL, which is used as collateral on multiple platforms. This provides investors with more investment options while enhancing market liquidity.

Stablecoins: The "Anchor" of the Cryptocurrency Market

Stablecoins serve as the "anchor" asset in the crypto market, with relatively stable value, holding a pivotal position in the cryptocurrency market. The tokenization characteristics of stablecoins make them digital currencies linked to traditional currencies or assets, providing greater stability.

A certain payment technology company, as the issuer of USDC, is promoting the GENIUS Act, which requires stablecoin issuers to hold equivalent short-term U.S. Treasury bonds as reserve assets and to disclose reserves. The act aims to ensure the transparency and stability of stablecoins, enhancing market trust.

Other stablecoin issuers are also facing new regulatory requirements following the passage of the GENIUS Act, which may impact their operational models. These companies may need to adjust their reserve mechanisms to ensure compliance with the new regulatory requirements.

Tokenization of Stocks: Connecting Traditional Stock Markets with the Crypto Market

Tokenization of stocks allows stock investments to be conducted via blockchain, enabling investors to make fractional investments with less capital while enjoying higher transparency and liquidity.

A certain EU fintech company has tokenized traditional stocks and ETFs into "xStocks", running on the Solana blockchain, providing global investors with a 24/7 trading experience for US stocks. The company holds approximately 77% market share in the tokenized stock market.

A U.S. registered transfer agent offers tokenized stocks and ETFs called dShares, ensuring that each dShare corresponds 1:1 with actual stocks. These tokens support trading on multiple blockchains, including Ethereum, Arbitrum, and Base.

A certain American company has launched a tokenized stock called EXOD, representing its Class A common shares. These tokens are managed on the Algorand blockchain, providing investors with an innovative and secure investment opportunity. The EXOD token has been listed on NYSE American, becoming the first tokenized stock to be listed on a U.S. stock exchange.

Private Credit: Providing Low-Cost Financing for SMEs

Private lending provides loans to businesses through non-traditional financial institutions and tokenizes these loans via blockchain to enhance capital liquidity and transparency.

Multiple decentralized lending platforms are providing financing channels for small and medium-sized enterprises by tokenizing assets such as accounts receivable. These platforms simplify the loan process through smart contracts, enhancing loan transparency and security, and offering new debt investment opportunities for global investors.

Real Estate Tokenization: Allowing Global Investors to Share in the Real Estate Market

Real estate tokenization allows small investors to participate in the traditionally high-threshold real estate market and enjoy greater liquidity.

Multiple platforms are digitizing real estate transactions through blockchain, allowing investors to participate in the global real estate market via tokenization. These platforms segment real estate assets into small tokens, enabling global investors to enjoy monthly rental income and making transactions more transparent.

Tokenization of Art and Collectibles: Providing New Investment Avenues for Collectors

The tokenization of art and luxury goods not only breaks the boundaries of traditional markets but also allows more investors the opportunity to participate in high-value collectible investments.

Multiple platforms are using blockchain to tokenize valuable items such as artworks, diamonds, and luxury watches, allowing investors to buy and trade these assets through blockchain. This provides investors with a new investment channel that is highly liquid and transparent.

Decentralized Exchange: A New Era of Crypto Asset Trading

The decentralized exchange ( DEX ) provides a more transparent and secure trading experience for the crypto market, avoiding the intermediary fees of traditional centralized exchanges.

Multiple DEX platforms focus on trading financial derivatives, structured products, and tokenized assets. Through a decentralized architecture, traditional financial assets can be traded on the blockchain, allowing global investors to participate in asset tokenization and trading.