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Tokenized real-world belongings (RWAs) reached just below $300 billion in 2025, with some projections inserting the market at $30 trillion by 2034.
A lot of the momentum is led by stablecoins, with Ethereum alone registering an all-time excessive provide of $165 billion this week. However in a world of excessive charges, high-friction, and clunky UX, are blockchain rails prepared to soak up such demand?
Regardless of the numerous developments in tokenized RWAs, crypto innovators are acutely conscious {that a} really seamless system stays a shifting goal.
“It’s evolving,” admits Aishwary Gupta, World Head of Funds at Polygon Labs. With a background in web2 funds and treasury administration at American Categorical (“shifting cash throughout the borders”), for Aishwary, the issue isn’t the tech: the technical rails themselves are shifting quick.
“For Polygon, we simply upgraded to 1,000 TPS, and in two months, we’ll be round 5,000 TPS. So successfully, the infrastructure is obtainable… You possibly can scale Polygon to have 50,000 transactions per second if the demand is coming in.”
Aishwary maintains that the previous scaling challenges are fading quick, but they’re rapidly being changed by different snags, equivalent to regulatory hurdles and liquidity bottlenecks.
In simply 4 years, the distinction is 180
Aishwary joined Polygon in 2021 as their “first full-time worker in DeFi.” Evaluating the state of tokenized funds right now to again then, he says, the distinction is night time and day. 4 years in the past, in response to Aishwary, the charges have been larger and the onboarding expertise far worse.
“4 years again, you’ll pay 5%, perhaps 10% as an on-ramp price. You would need to attempt 5 completely different on-ramps; perhaps one works. So, from that state of affairs to right now, it’s a lot simpler to exit and do these transactions and get on-ramps in your cash. Now we have not totally developed, however from a four-year perspective, it has turn into a lot smoother.”
The issue, Aishwary says, is that charges are formed by market construction and the patchwork of native guidelines:
“There are just one or two gamers specifically markets who’ve both obtained licensed or are in liquidity sandboxes. So the variety of people who find themselves successfully licensed to do the on-ramps and off-ramps is far decrease. Therefore, you will notice all this arbitrage coming in…
On-chain, you’re nonetheless paying just one cent, even should you transfer a billion {dollars}… It’s simply that regulatory arbitrage is in the best way.”
Regulatory readability: who’s profitable the tokenization race?
If stablecoin issuers and different tokenized RWA suppliers are benefiting from regulatory arbitrage, the place are they going? Which areas are finest getting ready for the multi-trillion-dollar explosion on this sector, taking the tech and operating with it, so to talk?
Aishwary factors to 4 important areas. The world’s monetary capitals, the U.S., Singapore, Europe, and the Center East:
“These are the highest 4 the place we’re seeing huge acceptance.”
The U.S. is main the cost, he says, having been a laggard for thus lengthy, because of years of regulatory opacity. As BitMEX CEO Stephan Lutz informed me just a few weeks earlier than, they [the Trump administration] virtually turned the state of affairs round in a single day with the GENIUS Act, which units out clear standards for stablecoin issuance and offers long-awaited regulatory readability to U.S. issuers.
Singapore is one other pioneer within the tokenized RWAs house, notably in terms of stablecoins. Its Fee Providers Act and Monetary Providers and Markets Act create a transparent licensing regime for digital token service suppliers, that are tightly supervised by the Financial Authority of Singapore and aligned with worldwide AML/CFT requirements.
Main firms like Nium, Zodia Custody, and Crypto.com have chosen Singapore for its progressive fee rails and regulatory framework. Aishwary shares:
“Aside from U.S. {dollars} within the fee house, I feel we see the second-highest quantity in Singapore {dollars}.”
Europe comes subsequent for Aishwary for example of “gradual and regular” progress. Whereas the MiCA laws might do with some tweaks, he says they’ve executed “plenty of due diligence” for stablecoin issuers, and established firms like Bitstamp and Fireblocks now provide regulated digital asset fee companies underneath the MiCA regime.
Lastly, the Center East will not be trailing far behind. In Abu Dhabi, for instance, regulators have outlined necessities for banks issuing stablecoins, creating clear tips for reserve administration and compliance.
Idle capital will all the time chase yield
Since Aishwary introduced up the GENIUS Act, I ask what he thinks in regards to the yield clause, which prohibits stablecoin issuers from paying the holder any type of curiosity or yield. He says:
“The issue is that this capital, which is sitting within the banks, is sitting as a result of they’re accruing at the very least some curiosity, not excessive, however nonetheless one thing. Now, if the identical greenback for you is supplying you with higher curiosity on-chain versus off-chain, then successfully you’ll need to maintain your greenback on-chain, which implies that it truly impacts the whole banking circulation.”
In truth, TradFi establishments and crypto-native asset managers alike are more and more in search of yield in on-chain merchandise like tokenized U.S. Treasuries, personal credit score, and controlled money-market funds.
By mid-2025, tokenized Treasuries surpassed $7.4 billion in AUM, with main gamers equivalent to Goldman Sachs, BNY Mellon, and Securitize actively allocating capital to those merchandise for larger yield, on the spot settlement, and versatile collateralization, typically outperforming standard off-chain financial institution devices.
Developments in tokenized RWAs past stablecoins
We flip from stablecoins to different traits inside tokenized RWAs. Whereas tokenized shares have gotten a favourite speaking level amongst centralized exchanges like Kraken and Coinbase, and DeFi platforms like Synthetix and Mirror Protocol, Aishwary is as frank as he’s analytical:
“Everyone seems to be within the frenzy of tokenized shares. They assume tokenized shares are one of the best factor. At Polygon, we did tokenized shares a yr and a half again. It doesn’t work. There’s no demand.”
I scratch my head and marvel why so little curiosity. He explains:
“Till you’re from North Korea and don’t have entry to Apple shares, I have already got entry to Apple shares in my checking account. Even sitting in India, even sitting in Dubai, anyplace on the earth. So that you’re probably not truly going to individuals who should not have entry to it.”
Furthermore, he says, liquidity stays an unsolved problem.
“The liquidity on-chain can also be a really large downside proper now. They don’t have that a lot liquidity. So more often than not you’ll find yourself having a nasty quote or having a nasty price.”
Not precisely the breakthrough many anticipated.
Commodities and non-USD stablecoins
The place does Aishwary see actual promise on this tokenized cash world? Two main traits that “persons are not specializing in sufficient but” are non-USD stablecoins and tokenized commodities.
“When you have a look at Polygon, now we have greater than 50 or 60% of the full market share of non-USD stablecoins, and that’s rising. We’re truly increasing on it much more. Commodities are additionally one thing, like gold, silver, to make them accessible and tradable.”
Globally, non-USD stablecoins now comprise round 30% of volumes in lively cross-border corridors exterior america.
For tokenized commodities, the worldwide market dimension reached roughly $25 billion in 2024, with gold tokens alone valued at ~$1.7 billion and oil, silver, and agricultural commodity tokens steadily growing their share. Aishwary provides:
“Now we have these commodities or belongings on chain already, however they haven’t but grown in a approach the place they turn into an ecosystem of their very own, so that’s one thing which is lacking.”
The trail to $30 trillion
As tokenized RWAs balloon into the trillions, it will likely be fascinating to see how the house shakes out. With gold hitting an all-time excessive in strategic reserves as international governments race to build up extra of the onerous asset, it’s logical that tokenized gold will observe.
In just some years, tokenization has moved from proof-of-concept pilots to international infrastructure, with billions now flowing into numerous real-world belongings throughout continents.
What’s subsequent isn’t nearly scaling up and clearing regulatory hurdles; it’s about how the business can truly unlock recent sorts of worth and usefulness, reaching far past what stablecoins have already begun.
