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This report highlights developments related to the tokenization and on-chain adoption of Real-World Assets (RWAs). Our report includes details on centralized industry players and asset class coverage, as well as coverage of select decentralized finance protocols working to integrate RWAs on-chain. Information is compiled from Digital Asset Research’s (DAR’s) data sources, public sources, media reports, and press releases, and, while wide-ranging, this report covers only representative initiatives related to the development and tokenization of RWAs in the digital asset space.
While many cryptocurrencies offer solutions to the challenges encountered by Web3 users, only a few digital assets possess characteristics that connect them to real-world economic activities. Skeptics contend that cryptocurrency use cases are confined to the digital realm, and therefore the value of crypto assets is not sustainable, given that much of daily life revolves around the physical world.
Real-world asset tokenization bridges this gap between the physical and digital worlds. Real-World Assets (RWAs) are assets that exist tangibly offline, such as real estate or equities. Tokenization refers to the process of generating a digital certificate that is impervious to alteration or replication to represent an RWA on a blockchain. These digital certificates are backed by real-world assets as collateral.
Through tokenization, investors can gain access to conventional investment opportunities in a more trustless and efficient manner via blockchain technology. Settlement can be conducted in real time and investors are always able to see where their assets are stored on chain. The spectrum of assets that could be tokenized includes but is not confined to, real estate, private credit, securities, commodities, and fiat currencies. A significant proportion of the world’s financial value is ascribed to RWAs, thereby presenting the potential for RWA tokens to access a total addressable market equivalent to the largest financial markets.
In this report, entities working on RWA initiatives are classified into two groups:
- Centralized organizations that offer tokenization services are detailed in the CeFi RWA sections.
- Decentralized Finance (DeFi) protocols that integrate RWAs with on-chain market participants are detailed in the DeFi RWA sections.
Significant RWA Tokenization News
- Blockchain network provider Ripple said real world asset tokenization could be a $16 trillion business by 2030.
- Archax, an FCA-regulated digital asset exchange, broker, and custodian, obtained an ISO27001 license backed by the International Standards Organization (ISO).
- Sony Bank and Sumitomo Mitsui, two of Japan’s largest banks, announced a partnership with Securitize to onboard security tokens, mostly condominium loan receivables, to the blockchain.
- Ondo Finance, a pioneer in tokenizing U.S. treasuries, extended its operations to Polygon.
- Avalanche announced a $50M initiative to encourage asset tokenization on its blockchain.
CeFi RWA Industry Players
The table below provides details on a selection of centralized tokenization service providers.
|Entity||Website||Founded||Jurisdiction||In-House Blockchain||Tokenized Asset Marketplace||Fractionalization of Assets||Self-Custody||Total Funding|
|Arca US Treasury Fund|| https://invest.arcalabs.com/#/log|
|Canton Network||https://www.canton.network/||2023||United States||Yes||No||No||No||Unknown|
|Enigma Vault||https://www.enigmavault.io/||2020||United States||No||No||No||Yes||Unknown|
|Fnality International||https://www.fnality.org/home||2019||United Kingdom||No||No||No||No||$62,000,000|
|Franklin Templeton|| https://www.franklintempleton.c|
|INX Digital||https://www.inx.co/||2017||United States||No||Yes||Yes||No||$96,500,000|
|Structure||https://structure.ﬁ/||2020||British Virgin Islands||No||Yes||No||No||Unknown|
|Texture Capital||https://www.texture.capital/||2019||United States||No||Yes||Yes||No||$1,000,000|
*Newly added to the report
- 23 of the listed organizations are registered in the United States, followed by Switzerland and the United Kingdom with 4 and 3 projects each, and Luxembourg with 2 projects.
- This month we have an addition of institutions based in India and Indonesia.
- Only 9 organizations utilize an in-house blockchain network.
- 27 of the organizations have their own tokenized asset marketplace.
- 32 organizations support the fractionalization of real-world assets.
CeFi RWA Asset Classes
The table below displays the types of underlying assets tokenized by the selected protocols.
|Entity||Real Estate||Equities||Commodities||Fixed Income||Private Credit||Forex||Other (Art, Luxury, etc.)|
|Arca US Treasury Fund||✔|
|Riddle & Code||✔||✔|
*Newly added to the report
- New additions to this report Ekta and RealX fractionalize real estate ownership in Indonesia and India, respectively.
- Spydra, which is also newly added to this report, is a platform that allows for tokenization of various different assets, with its main product being tokenizing carbon credits.
- The most common tokenized asset types are equities (24) and real estate (22).
- Tokenization of private credit and luxury goods are almost as popular, with 15 and 11 platforms, respectively, providing these services.
- Tokenization of foreign exchange and commodities based-assets are least popular among CeFi RWA providers.
DeFi RWA Industry Players
The table provides details on a selection of 31 on-chain tokenization providers. Unlike their CeFi counterparts, DeFi RWA providers are generally more permissionless, with a majority of operations conducted on the blockchain.
|Entity||Blockchain(s)||Sector||Asset Class(es)||Founding Year||Geography/Jurisdiction|
|AmFi||Avalanche||Credit||Credit & Loans, Real Estate||2022||United States|
|Backed Finance||Ethereum, Gnosis||Tokenization||Credit & Loans, Equities||2021||Switzerland|
|Bitbond||Arbitrum, Avalanche, Binance, Ethereum, Optimism||Tokenization||Fixed Income||2013||Germany|
|Bluejay Finance||Ethereum||Stablecoin Credit||Fixed Income||2021||Singapore|
|Canza Finance||Avalanche, Celo||Stablecoin Credit||Credit & Loans||2020||Nigeria|
|Carapace Finance||Ethereum||Credit||Credit & Loans||2021||Unknown|
|Centrifuge||Ethereum||Credit||Credit & Loans, Real Estate||2017||Switzerland|
|Clearpool||Ethereum, Polygon||Credit||Credit & Loans||2021||Hong Kong|
|CredeFi||Ethereum, Binance||Credit||Credit & Loans||2020||Bulgaria|
|Credix||Solana||Credit||Credit & Loans||2021||Belgium|
|Dexstar||Ethereum||Credit||Credit & Loans||2021||Cayman Islands|
|DEFYCA||Avalanche||Tokenization||Credit & Loans, Fiat||2021||Luxembourg|
|Fabrica||Ethereum||Derivatives||Real Estate||2019||United States|
|Florence Finance||Ethereum||Credit||Credit & Loans||–||United Arab Emirates|
|Frigg||Ethereum||Credit||Credit & Loans||2022||Switzerland|
|Goldﬁnch||Ethereum||Credit||Credit & Loans||2020||United States|
|LandX||Ethereum||Credit||Credit & Loans||–||Lithuania|
|Maker||Ethereum||Stablecoin Credit||Credit & Loans, Cryptocurrencies||2015||Denmark|
|Maple||Ethereum, Solana||Credit||Credit & Loans||2020||Australia|
|Maxos||Ethereum||Stablecoin Credit||Credit & Loans||2020||United States|
|Obligate||Polygon||Credit||Credit & Loans||2019||Switzerland|
|Ondo Finance||Ethereum||Tokenization||Credit & Loans||2021||United States|
|Parcl||Solana||Derivatives||Real Estate||2022||British Virgin Islands|
|Polytrade Finance||Polygon||Credit||Credit & Loans||2021||United Arab Emirates|
|PurpleFi||–||Tokenization||Real Estate||2022||United Kingdom|
|Sapling||Polygon||Credit||Credit & Loans||2022||United Kingdom|
|Tangible||Polygon||Stablecoin||Luxury Goods, Precious Metals, Real Estate||2021||United States|
|Toucan Protocol||Polygon, Celo||Tokenization||Carbon Credit||2021||Switzerland|
|TrueFi||Ethereum||Credit||Credit & Loans||2020||United States|
*Newly added to the report
- Ensuro and Meld Gold are newly added to this report. Ensuro is a platform that tokenizes insurance products onto the blockchain, while Meld Gold is a decentralized platform for gold tokenization running on the Algorand network.
- As of the end of July 2023, Credit & Loans is the most common sector for DeFi tokenization products with a total of 22 platforms supporting real-world loans.
- Ethereum is the most common blockchain among RWA DeFi applications, with 22 out of 33 platforms being run on the blockchain.
- A smaller portion of the RWA DeFi applications run on the Polygon, Solana, Avalanche, Celo, BNB Smart Chain, and Gnosis Chain blockchains.
DeFi RWA Protocols
The following table provides details on DeFi protocols that integrate real-world assets. These range from on-chain emerging markets lenders to protocols providing on-chain market participants with access to US Treasury Bills.
|Protocol||Network||Active Loans||Total Lifetime Loans||Total Value Locked (TVL)||Market Capitalization of Protocol’s Native Token||Month over Month Change in Market Capitalization (%) of Protocol’s Native Token|
*Newly added to the report
- Active loans increased slightly from last month’s data. Centrifuge, Maple, Goldfinch, and Clearpool all issued more loans this month, while active loans data remain stagnant for Credix, TrueFi, and HomeCoin.
- The increase in active loans translates to an increase in total lifetime loans for the protocols mentioned above.
- By contrast, changes in total value locked varies for each protocol, implying that the number of loans and total value locked are not perfectly correlated at all times.
- The same pattern is observed for market capitalization of the protocol’s native currency. An increased number of loans do not equate to an increase in price or circulating supply of the protocol’s tokens.
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