RWA Track Depth Analysis: 2025 Crypto Market Rise Engine

The rapid rise of decentralized finance (DeFi) has created a financial ecosystem that does not rely on traditional banking systems. However, the core issue faced by the DeFi sector is the market's high dependence on encryption assets, lacking sufficient real-world assets (RWA) support. The RWA track is breaking this limitation by combining real-world financial assets with blockchain technology, enhancing the stability of on-chain financial products and bringing significant liquidity increments to the market. This track has become a key bridge for institutional investors and mainstream financial institutions to enter the crypto industry, potentially driving the entire blockchain industry into a new growth cycle.

The core concept of RWA is to digitize assets in traditional financial markets (such as bonds, real estate, stocks, artworks, private equity, etc.) and convert them into tokenized assets that can be traded, collateralized, or lent on the blockchain through blockchain technology. This not only enhances asset liquidity but also reduces friction costs in traditional financial markets, such as long transaction clearing times, high intermediary costs, and limited liquidity issues. Taking the bond market as an example, traditional trading involves multiple institutions and regulatory bodies, with cumbersome processes leading to high costs, while RWA tokenization can achieve real-time clearing on-chain, greatly improving trading efficiency and reducing costs. At the same time, the transparency and traceability of blockchain make RWA asset management more transparent, effectively reducing market fraud and improper operations.

The RWA sector is attracting more and more institutional participation. One of the largest asset management companies in the world, BlackRock, has launched a blockchain-based tokenized fund called BUIDL, which primarily holds stable assets such as U.S. Treasuries and provides a more efficient trading method through blockchain. Traditional financial giants like Franklin Templeton are also trying to tokenize some of their fund products to make it easier for investors to participate in the market. These cases indicate that the RWA sector has become a core trend in the digitalization of the global financial market.

From a technical perspective, the development of RWA relies on multiple key infrastructure supports, including the underlying blockchain network, smart contracts, oracles, decentralized identity (DID), and compliance management. Ethereum remains the preferred network for RWA tokenization, with many institutions deploying smart contracts on Ethereum to manage RWA assets. At the same time, L2 solutions (such as Arbitrum and Optimism) have become popular choices for RWA asset trading, aiming to reduce transaction costs and improve throughput. Public chains like Solana, Avalanche, and Polkadot are also exploring application scenarios for RWA assets, striving to capture market share.

The potential of the RWA track is enormous. Boston Consulting Group (BCG) estimates that by 2030, the RWA track market size will reach $16 trillion, far exceeding the current total market value of the entire crypto market. The global real estate market is valued at approximately $300 trillion; if 1% of assets are tokenized, it could create a $3 trillion RWA market. The global bond market size exceeds $120 trillion; if 1% enters blockchain, it will form a $1.2 trillion emerging market.

Institutional funds are accelerating their influx into the RWA track, indicating that this field has become an important component of the global financial system. This trend is expected to continue into 2025 as government support for the encryption industry increases. For investors, the RWA track not only provides new market opportunities but may also serve as an important bridge for the integration of the crypto market and traditional financial markets. In the coming years, with improved infrastructure, the implementation of regulatory frameworks, and further positioning by mainstream financial institutions, the RWA track is expected to become a new growth engine for the blockchain industry, driving the digital transformation of the entire financial market.

Overall, the emergence of the RWA track represents the maturity of blockchain technology and the expansion of application scenarios, which also means that the global financial market is entering a new stage of decentralization and efficiency. For market participants, how to seize the opportunity of RWA asset tokenization and layout infrastructure and key protocols will become the core proposition for the development of the crypto industry in the coming years.

Current Market Environment: Macroeconomic and RWA Development Catalysts

Against the backdrop of increasing global economic uncertainty, changing liquidity cycles, and the booming digital asset market, the RWA track is becoming one of the most important growth points in the encryption industry. The Federal Reserve's adjustments to monetary policy, persistent inflation pressures, fluctuations in the debt market, and increased institutional participation have brought unprecedented opportunities for the development of RWA. At the same time, the drawbacks of the traditional financial system and the maturity of DeFi are driving the migration of real-world assets to the chain. This article explores the catalytic factors for the development of the RWA track from five aspects: global macroeconomic situation, liquidity environment, policy regulation trends, institutional entry, and DeFi ecosystem maturity.

Global macroeconomic situation: inflation, interest rates, and changes in market risk aversion sentiment

The global macroeconomic environment is a core variable affecting the development of RWA. In recent years, due to factors such as weak economic recovery after the COVID-19 pandemic, escalating geopolitical conflicts, supply chain issues, and adjustments in central bank policies, there is significant uncertainty in global economic growth. Inflation and changes in interest rate policies directly affect capital liquidity and investors' asset allocation strategies, indirectly promoting the development of the RWA sector.

In the past two years, the Federal Reserve's aggressive interest rate hike policy has had a profound impact on global markets. Since 2022, the Federal Reserve has raised interest rates multiple times to curb the high inflation rate, leading to a tightening of global liquidity. In a high-interest-rate environment, investors' risk appetite decreases, traditional financial markets are impacted, and capital tends to flow into low-risk, high-yield asset classes. This has prompted investors to focus on assets such as government bonds, gold, and real estate, and the tokenization of these assets has become an important growth point in the RWA sector. For example, the tokenization of U.S. Treasuries (such as the OUSG token provided by Ondo Finance) has become an important investment tool in the crypto market due to its high annualized yield (over 5%), attracting a large influx of DeFi funds.

As the global debt crisis intensifies, the RWA track has become an important option for capital hedging. By 2024, the total global debt is expected to exceed 300 trillion dollars, with US Treasury bonds exceeding 34 trillion dollars and the fiscal deficit hitting a historic high. Investor confidence in traditional financial markets has been impacted, leading them to seek more transparent and efficient financial infrastructure. The trustless, borderless, and low-cost features provided by blockchain technology make the on-chainization of RWA assets the best solution. In a high-inflation environment, the demand for gold and commodities has surged, with gold tokens (such as PAXG and XAUT) becoming popular assets in the crypto market. Overall, the uncertainty of the global economy has increased investors' demand for safe-haven assets, and innovations in the RWA track have made it easier for these assets to enter the crypto market, driving explosive growth in this track.

Liquidity environment: The Federal Reserve's policy shift and changes in market risk appetite

The rapid development of the RWA track is inseparable from changes in the global liquidity environment. The Federal Reserve's significant interest rate hikes from 2022 to 2023 have led to a severe tightening of global market liquidity. Since 2024, as inflation pressures ease and the Federal Reserve enters the final stages of interest rate hikes, and may even begin a rate-cutting cycle, market liquidity expectations have changed, greatly boosting the RWA track.

The adjustment of the Federal Reserve's monetary policy has led to an increase in market demand for stable yield assets. The DeFi ecosystem experienced high volatility and high-risk phases from 2021 to 2022, and current investors are more inclined towards low-risk, predictable yield products. The RWA track just provides this solution. For example, bond tokenization and private market tokenization allow investors to enjoy a more stable and compliant yield model within the DeFi ecosystem, which is also one of the important reasons for the RWA explosion in 2024.

From the perspective of the crypto market, BTC will welcome the approval of spot ETFs in 2024, with institutional capital continuously flowing in, expanding the entire crypto market's capital pool. These funds need to seek more stable investment targets outside of BTC. RWA assets, due to their deep binding with traditional financial markets, have become an important allocation direction for institutional funds. Asset management giants like BlackRock and Fidelity have begun to pay attention to the RWA field and have launched related investment products, further promoting the rise of the RWA sector.

As DeFi interest rates decline, the yield advantage of the RWA track becomes increasingly apparent. From 2021 to 2022, the yield in the DeFi ecosystem generally exceeded 10%, but by 2024, the yield on stablecoins from most DeFi protocols has dropped to between 2% and 4%, while the yield on U.S. Treasury bonds in the RWA track remains above 5%, making RWA assets a new pillar of DeFi yields, attracting a large influx of capital.

Policy regulatory trends: The compliance process of the RWA track

In the development process of the crypto industry, regulatory issues have always been a focus of market attention, and the rise of the RWA track is due to its greater compliance compared to other DeFi tracks, meeting the needs of institutional investors. Regulatory agencies in various countries are gradually accepting the innovative model of asset tokenization and exploring how to support the development of the RWA ecosystem through legal frameworks.

The U.S. SEC (Securities and Exchange Commission) and CFTC (Commodity Futures Trading Commission) have begun research in areas such as tokenization of securities and tokenization of bonds, allowing certain institutions to issue tokenized assets within a compliant framework. For example, Securitize has been recognized by the SEC and can issue blockchain-based security tokens, providing a good model for the compliance of the RWA sector.

Europe, Japan, Singapore and other regions hold a relatively open attitude towards the RWA track. Switzerland's SIX Digital Exchange (SDX) and Germany's Boerse Stuttgart Digital Exchange (BSDEX) have supported tokenized stock trading, and the Singapore government is also actively promoting the on-chain development of RWA assets. These favorable policies make institutional investors more willing to enter the RWA track, providing a solid foundation for its development.

Institutional entry and the rise of DeFi ecosystem maturity

In addition to macroeconomic factors and regulatory policies, the entry of institutions and the maturity of the DeFi ecosystem are also important driving forces for the growth of the RWA track. Traditional institutions are beginning to pay attention to the integration of DeFi and TradFi (traditional finance), with many leading asset management companies, banks, and hedge funds starting to explore how to issue and trade RWA assets on the blockchain. The DeFi ecosystem is gradually shifting from "high volatility, high risk" to "stable returns, compliant development," making the RWA track a core beneficiary of this trend. More and more DeFi protocols (such as MakerDAO, Aave, Maple Finance) are deeply integrating with RWA assets, giving the growth of the RWA track stronger sustainability.

In summary, the explosion of the RWA track is not only the result of market demand but also the product of the combined effects of the global macro economy, policy regulation, liquidity environment, and the evolution of the DeFi ecosystem. Driven by these catalytic factors, the RWA track is expected to become one of the most important engines for the rise of the crypto market in 2024-2025.

RWA Track Main Categories and Core Project Analysis

As the crypto market continues to mature and institutional funds accelerate their influx, the rise of the RWA track has become a significant trend. The core goal of the RWA track is to issue, trade, and manage traditional financial market assets, such as bonds, real estate, commodities, and private equity, through blockchain tokenization, making them more liquid, easier to access, and able to integrate with the DeFi ecosystem. This not only brings the convenience of decentralized finance to traditional assets but also provides a more stable source of income for the DeFi ecosystem. The application scenarios of the RWA track are rich and varied, with different types of real-world assets exhibiting different forms on-chain, typically categorized into the following major types: bond-type RWA, commodity and bulk asset RWA, real estate RWA, equity and private market RWA, and infrastructure and supply chain RWA.