TL;DR
- In 2025, real-world asset (RWA) markets could reach a value of $5 trillion, driven by tokenization and the democratized access to traditional assets.
- Improvements in blockchain infrastructure and the implementation of clear regulations will attract institutional investors, who are expected to provide over 70% of the liquidity in these markets.
- Interoperability between blockchains and the growth of DeFi platforms will be key to reducing market fragmentation and boosting the trade of RWAs.
In 2025, real-world asset (RWA) markets are expected to enter a strong phase of growth and achieve high adoption levels, propelled by the popularization of tokenization.
Tokenization is a process that allows traditional assets like real estate, private equity, and bonds to be represented as tokens on the blockchain. This tool is driving significant improvements in liquidity and access to these assets.
Thanks to its ability to fractionalize ownership of assets, tokenization opens new opportunities for both retail and institutional investors. It is estimated that the RWA market could reach $5 trillion by 2025, with the real estate sector accounting for a substantial portion of this figure.
Crucial Factors for the Success of RWA Tokenization
Advancements in RWA tokenization will also provide much more democratic access to asset classes that were previously restricted to large institutions. Small investors will be able to participate in markets historically exclusive to large capital players. The increase in the diversity of participants will enhance the price discovery process. The liquidity of assets like real estate could improve by 50% to 60% compared to traditional investments, which would also promote greater efficiency in asset valuation.
It is essential to understand that the development of adequate regulatory frameworks will be fundamental to the growth of the tokenized asset market. In the coming years, clear and coherent regulations for “digital securities” are expected to be implemented, which will increase investor confidence and promote cross-border trade.
The adoption of unified regulations, such as those emerging in the European Union, could encourage up to a 40% growth in institutional participation within secondary RWA markets. The creation of specialized and regulated platforms will attract institutional investors, strengthening the market further.
Infrastructure and Interoperability as Key Drivers
On the other hand, improvements in blockchain infrastructure will positively impact the participation of financial institutions. Custody solutions and faster settlement times will enable institutional players to access a market characterized by its convenience. These institutions are expected to account for over 70% of the liquidity in tokenized asset markets by 2025.
Interoperability between different blockchain platforms will be another key factor for the growth of the RWA market. The ability to seamlessly transfer assets from one blockchain to another will be essential to reducing market fragmentation and improving global liquidity. Platforms implementing cross-chain interoperability solutions could handle more than half of tokenized transactions by 2025.
Additionally, decentralized finance (DeFi) platforms will play a crucial role in this process. They will offer an efficient and cost-effective alternative for trading tokenized assets. Transaction volumes in DeFi are expected to skyrocket, leading to a dynamic and inclusive market.
The year 2025 will be pivotal for the tokenization of RWAs, as improvements in blockchain infrastructure, clear regulations, and institutional participation will contribute to a more efficient, accessible, and globalized ecosystem for secondary markets
