June 21, 2024

Tokenized real-world assets garner significant attention in the crypto space as major TradFi firms buy-in. 

A prominent analyst in the industry, Miles Deutscher, expresses a bullish stance on real-world assets (RWAs). According to the analyst, RWA has become one of the top opportunities for investors this cycle.

This bullish stance comes as the global largest asset manager, BlackRock, recently launched its tokenized asset.

Analyst Discloses RWAs’ Significant Growth In 2024 And Beyond

In an April 8 tweet, Deutscher discussed the RWAs, their significant growth, and future potential. He believes tokenized assets can reach $10 trillion by 2030 based on the adoption rate.

Deutscher started his discussion by defining RWAs. According to him, RWAs are tokens developed on blockchain that represent physical assets such as gold, commodities, real estate, etc.

Notably, they represent users’ ownership rights of a physical asset on the blockchain. This means the owners have on-chain tokens linked to their real assets.

Built on blockchains, RWAs have received more attention due to certain advantages. They explore huge global markets like gold ($13.5 trillion) and bonds ($133 trillion).

Also, RWAs have lower entry barriers and reduce costs applicable to brokerage and middlemen. They utilize real-world income-generating assets to account for DeFi yields.

Usually, issuers of RWAs use smart contracts to mint the tokens, determine their value, and control how they are traded on the underlying blockchains.

Deutscher used statistics and a chart to analyze the growing adoption rate of RWAs. According to the analyst, the market cap of tokenized public securities has exceeded $700m. According to a Bank of America report, the tokenized gold market cap has hit almost $1 billion.

BlackRock Launches a Tokenized Fund

The world’s biggest investment manager, BlackRock, launched a tokenized fund last month, further increasing the growing appeal for RWAs.

BlackRock issued its tokenized fund, the USD Institutional Digital Liquidity Fund (BUIDL), on a public blockchain. The firm uses Securitize Markets LLC as the subscription source for BUIDL. 

Investing in BUIDL offers investors the benefits of issuing and trading ownership on a blockchain. According to BlackRock, qualified investors could earn US dollar yields through subscriptions to the fund.

It also expands investors’ on-chain offerings and ensures transparent and immediate asset settlement. Users can easily transfer across several platforms, as BNY Mellon, an American banking and financial services giant, will facilitate interoperability for BUIDL.

According to BlackRock’s Head of Digital Assets, Robert Mitchnick, the fund’s launch marks a milestone in the Company’s digital assets strategy. He noted that BlackRock is committed to developing digital asset solutions that solve real problems for its clients. 

According to Deutscher, BlackRock isn’t the first TradFi firm to launch tokenized assets. Other TradFi giants such as JPMorgan, Citi, and Franklin Templeton have adopted RWA.

The analyst highlighted some RWA protocols with huge potential, including ONDO Finanance’s ONDO, which boasts a TVL of $250 million. He also mentioned Chainlink’s LINK as a key to unlocking RWAs’ full potential.


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