Real-World Assets Set to Reshape Onchain Finance as TVL Surges

It’s not so long ago that real-world assets (RWAs) were fighting to be taken seriously as a legitimate onchain sector. In the depths of the last bear market, some critics even dismissed RWAs as DeFi desperately seeking a new use case in a bid to stay relevant. They’re not dismissing RWAs now.

Critics of the onchain sector, which is fast approaching $200B in TVL, are in short supply. They’re likely to have gone entirely extinct by 2030, when RWAs are predicted to reach $30 trillion in an event dubbed The Great Tokenization. That’s a cool 50x. But even if they fail to achieve that bullish projection made by Standard Chartered, and pull a mere 10x, which is the average growth estimated by a handful of independent financial analysts, that’s still mighty impressive.

How did RWAs become a legitimate asset class so quickly, and aside from greater TVL, what does their future hold?

From Zero to Billions

Real-World Assets (RWAs) have rapidly evolved from a niche concept into a core pillar of decentralized finance. Tokenizing off-chain assets such as commodities, real estate, and securities opens new pathways for liquidity, global participation, and market efficiency. And right now, institutions and trading firms can’t get enough of the stuff.

The rise of RWAs is neither accidental nor speculative but the result of growing acknowledgment among institutions and retail investors that legacy financial infrastructure is ready for an upgrade. It’s the same acknowledgement that’s taken BTC past six figures and turned crypto into a multi-trillion dollar asset class.

Regulatory clarity has been gradually improving, web3 technology has become more robust, and user interfaces have advanced to the point where complex transactions can be executed with a few clicks. In a digital world, tokenizing assets that were once confined by time zones and national borders is the logical next step, transforming them into borderless financial instruments that can be traded 24/7.

That’s not to say it’s all been plain sailing for RWA tokenizers. It’s taken time for compliance, custody, and interoperability between blockchain networks to be solved, laying the foundation for institutions to start onboarding. But as an examination of the RWA landscape today shows, the onchain world is now open for business, with the legal and technical challenges having been surmounted.

The State of RWAs Today

The diversity of RWAs, both in terms of the assets they’re backed by, the markets they support, and the networks where they operate is impressive. From dedicated chains to general-purpose L1s, RWA protocols have sprung up across the onchain landscape, assuming many forms but with a shared common goal: delivering sustainable yield, greater capital efficiency, and unlocking global access to formerly siloed or fragmented markets.

Take INX, for example, whose recently launched Quick Buy feature makes RWAs as easy to purchase as conventional cryptos. It’s a small refinement, but one which plays a role in normalizing RWAs and making them as accessible to retail traders as they are to pro and institutional traders. Broadening access to RWAs isn’t just about making them available globally: it also calls for making them easier for onchain users to trade.

The ultimate goal, for the entire sector, is for tokenized RWAs to become as commonplace as traditional equities or bonds. Just as many boomers now hold Bitcoin and millennials memecoins, we’re moving towards a future where buying tokenized RWAs is routine, with no technical barriers or friction: one click and you’ve got gold or bought a barrel of crude.

A Few Things Still to Fix

RWAs have performed admirably over the last 12 months, significantly growing TVL, broadening the range of onchain assets, and unlocking new opportunities for users to earn sustainable yield. There have also been significant improvements in infrastructure, onboarding, and compliance. It’s clear the sector has found product-market fit and that the future of finance lies onchain.

That said, if RWAs are to achieve their bull prediction of pulling a 50x in TVL by 2030 – or even the baseline of a 10x – there’s still a few things to fix. Fragmentation, for one thing, risks scattering users far and wide, with no single platform yet to emerge as the face of RWA tokenization. While reliance on any single entity is healthy, right now the market risks skewing the opposite way, causing liquidity and opportunities to become fragmented across multiple chains and protocols.

This is a self-correcting problem, however, with DeFi’s composable nature inevitably leading to aggregators and interoperable protocols that will combine RWA opportunities into single dapps and “super protocols” that capture the best onchain has to offer. It may also be the case that the Uniswap of RWAs has yet to be invented – but when it arrives, we’ll recognize it all right.

In the meantime, TVL keeps rising steadily as institutions onboard and capital flows from legacy finance into the future of finance. While the price of RWA tokens themselves will remain as steady as the underlying assets they’re backed by, the total value locked into these protocols is on its way to leaving the rest of DeFi in the shade. Right now, most RWA liquidity is credited to stablecoins. In the future, it will come from much more diverse sources as everything from fine art from rare metals is tokenized and traded onchain.

Disclaimer: Coinspeaker is committed to providing unbiased and transparent reporting. This article aims to deliver accurate and timely information but should not be taken as financial or investment advice. Since market conditions can change rapidly, we encourage you to verify information on your own and consult with a professional before making any decisions based on this content.

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