Tokenizing Real-World Assets on the Blockchain: A New Frontier



Key Takeaways

  • Real-world asset tokenization, once the domain of financial incumbents, now gains momentum among crypto native players.
  • On-chain institutions like MakerDAO are exploring tokenization to access yield, expanding the scope beyond traditional players.

The Origins of RWA Tokenization

The concept of tokenizing real-world assets (RWA) on a blockchain has become one of the most discussed topics of the year. Initially driven by financial incumbents such as Citi, JPMorgan, and Northern Trust, the buzz around RWA tokenization now extends to crypto native players, marking a significant shift in the landscape.


The early discussions and hype surrounding tokenization using blockchain technology date back to around 2015. At that time, traditional banks and financial institutions explored the potential of blockchain’s underlying ledger technology to revolutionize various aspects of finance. Key benefits included the promise of 24/7 settlement, guaranteed execution, and reduced transaction fees. Initially, this wave of interest focused on blockchain’s potential while distancing itself from cryptocurrencies like Bitcoin.

A Broader Appetite for RWA Tokenization

In recent years, as the cryptocurrency space increasingly intersects with the broader financial market, the appetite for RWA tokenization has expanded to include a more diverse set of participants. While traditional institutions like high-net-worth individuals, family offices, pension funds, and university endowments continue to express interest in RWA tokenization, a new player has emerged: on-chain institutions.


Maria Shen, a general partner at Electric Capital, highlights the emergence of on-chain institutions as a significant development. For instance, the DeFi protocol MakerDAO has ventured into tokenization. Shen explains that MakerDAO works with institutions to tokenize T-bills, effectively creating new opportunities within its ecosystem. This shift marks a noteworthy departure from previous RWA discussions.

Diverse Use Cases for RWA Tokenization

The expansion of RWA tokenization has given rise to diverse use cases. Retail users can now leverage RWAs for remittances and savings. Businesses are increasingly using stablecoins for supplier payments. Meanwhile, in-chain institutions like MakerDAO aim to access yield through tokenized Treasurys. This diversification of use cases demonstrates the versatility of RWA tokenization.

Evolving Economics and Credibility

Stuti Pandey, from Kraken Ventures, highlights the evolving economics and credibility of RWA tokenization. Over recent years, low-interest rates favored high-growth, high-risk assets, impacting the potential for RWAs. However, with declining interest rates, real-world assets are gaining attention for their attractive yield. Improved tokenization infrastructure and increased mindshare within the crypto space also contribute to the current momentum of RWA tokenization.


The landscape of RWA tokenization has evolved significantly, transcending its origins among financial incumbents. With crypto native players and on-chain institutions actively participating, the scope and possibilities of blockchain-based RWA tokenization continue to expand. This shift signifies a new frontier in the world of finance, where blockchain technology is reshaping how real-world assets are transacted and utilized.