Real-world asset (RWA) tokenization protocols have experienced significant growth over the past year, with the total value locked (TVL) in the sector reaching nearly $8 billion by the end of April. This surge can be attributed to the market’s increasing interest in high-yield, debt-based investments. The analytics firm Messari noted that RWA protocols have seen a resurgence driven by this market demand, with TVL increasing by almost 60% since February. The TVL figure excludes fiat-backed stablecoins and covers areas such as carry trade protocols, yield-bearing stablecoins, commodities, securities, and real estate tokenization protocols.
In addition to the TVL growth, RWA protocols have also seen an increase in active users, with smaller retail users showing a growing interest in these protocols. Certain protocols, such as Toucan, KlimaDAO, and Propy, have played a significant role in driving this growth and attracting more users. Tokenized treasuries have also expanded significantly as yields remain high amidst elevated inflation and interest rates in the United States. Platforms like RWA.xyz have reported record amounts locked in tokenized U.S. treasuries and bonds, with Securitize and Ondo contributing to this growth.
The recent performance of BlackRock’s Ethereum-based Institutional Digital Liquidity Fund (BUIDL) and the Franklin OnChain U.S. Government Money Fund (FOBXX) has further bolstered the RWA market, with BUIDL becoming the world’s largest tokenized treasury fund. Both public and private blockchains are incorporating various assets, with examples such as Franklin Templeton’s U.S. Government Money Fund expanding to different blockchain networks. Backed Finance has launched a tokenized short-term U.S. treasury bond ETF, and UBS Asset Management has deployed a tokenized money market fund on the Ethereum blockchain. DigiFT, a Singapore-based fintech company, has also ventured into the digital asset realm with the launch of its US Treasury bill depository receipt tokens, offering fractional ownership in US Treasury bills to investors without requiring substantial upfront capital.
The surge in TVL and active users within RWA protocols reflects the growing adoption and interest in these offerings among market participants. The market’s preference for high-yield, debt-based investments has been a key driver of this growth, with notable protocols like Toucan, KlimaDAO, and Propy attracting more users. Tokenized treasuries have seen remarkable expansion, and the performance of funds like BUIDL and FOBXX has further boosted the RWA market. With both public and private blockchains incorporating various assets, the sector is poised for continued growth and innovation as more investors seek exposure to tokenized real-world assets.
Overall, the rapid growth of RWA tokenization protocols signifies a shift towards high-yield, debt-based investments in the market. Platforms like Toucan, KlimaDAO, and Propy have played a crucial role in driving this growth and attracting more users. The expansion of tokenized treasuries and the performance of funds like BUIDL and FOBXX have further bolstered the RWA market, highlighting the increasing interest from both retail and institutional investors. With various assets being included in both public and private blockchains, the sector is experiencing robust growth and innovation, showcasing the potential for continued expansion in the future.
