Tokenized Real-World Assets Market Expanding Rapidly, Facing Obstacles

The tokenized real-world assets (RWAs) market is rapidly expanding, with the primary challenge to wider adoption being the absence of dedicated secondary markets for trading tokenized securities, as stated by Prometheum founder and co-CEO Aaron Kaplan. Kaplan emphasized the significance of regulatory clarity in the tokenization sector, highlighting that the US SEC's special purpose broker-dealer framework and ATS licensing offer a regulated pathway for issuing blockchain-native funds. Despite the increasing value of tokenized RWAs, the limited market infrastructure for trading these assets remains a bottleneck, particularly for institutional and retail investors. Two main strategies are being pursued to tackle this issue: establishing decentralized tokenized securities markets through DeFi frameworks and incorporating tokenization protocols into existing brokerage platforms under SEC-registered entities. The demand for tokenized assets, especially in real estate, is on the rise as investors look for digital native versions of traditional assets within a familiar ecosystem.

In a recent article by Digital Asset co-founder and CEO Yuvan Rooz, the World Economic Forum highlighted the potential of tokenization. Rooz noted that around 10% of the $230 trillion global securities market could serve as collateral. Tokenization, according to Rooz, can improve collateral mobility and capital efficiency, potentially unlocking untapped capital and optimizing intraday liquidity to meet payment and settlement obligations within the same trading day. The magazine article titled "Block by block" explores the transformation of the real estate market by blockchain technology.