RWA Tokenization: Catching Up with The Numbers, The Institutional Players and The Market Predictions

With the exponential growth of stablecoins in 2024, it's safe to say that RWA tokenization is the next big thing. According to RWA.xyz, stablecoins recorded a massive 3800% growth between 2020 and 2024, surging from $4 billion to over $156 billion and bringing its total RWA market share to over 90%.

This article provides fresh insights into the state of RWA tokenization in 2024, focusing on the growth statistics, its key players, market predictions and emerging trends.

State of RWA in brief

The brave new world of RWA tokenization has attracted significant attention in traditional finance where–according to a recent survey by Tokenized Assets Coalition–about 86% of Fortune 500 executives recognize its potential benefits. Moreover, there has been a consistent institutional narrative about its projected growth, with leading market analysts estimating trillions of dollars of tokenized assets by 2030.

RWA tokenization has recently emerged as a fast growing trend with the potential to shape the global investment landscape, thanks to the surging stablecoin volume and a fast paced institutional adoption.

While payment stablecoin is leading the charge, real estate is the sleeping giant of RWA tokenization. Other use cases such as treasury bonds, private credits, commodities and stocks add significantly to the industry’s trillions of dollars worth of total addressable markets.

RWA Tokenization Growth

The growth pattern of RWA tokenization has inspired an interesting narrative about its huge potential. According to the recent report by Tokenized Assets Coalition, the current market size of tokenized assets is valued at $186 billion with a 32% year-to-date increase and over 150 tokenized asset issuers around the globe.

Based on a sector specific analysis, stablecoin is responsible for a large percentage of the growth of the RWA total market size, while others sectors such as real estate, commodities(ie gold, silver, etc), and treasury bonds, have not only gained significant traction but have also shown tremendous growth potential as well.

For instance, the tokenized real estate market is poised to experience a rapid growth in the years ahead as it continues to attract significant attention from traditional institutions lured by its potential to usher in liquidity and open up access to retail investors globally. According to Block square, the tokenized real estate sector is estimated to reach $26 billion by 2034.

Furthermore, there are some other notable events that point to the growth and mainstream recognition of the RWA tokenization. These include MakerDOA's $1 billion investment in tokenized US treasuries, Goldman Sachs’s RWA tokenization projects, BlackRock's investment in US treasuries through its $500 million BUIDL fund, PricewaterhouseCoopers’ 2024 RWA Tokenization cohort and the US tokenized treasures reaching a $1 billion milestone.

Most importantly, the growth of RWA tokenization is very much tied to the increasing role of payment stablecoin in traditional finance as evident in its ability to bring about instant settlement and low fees. The billion dollar moves by key players such as Goldman Sachs, MakerDAO, Ripple, Coinbase, BlackRock, etc. also contribute to the growth trajectory and future outlook.

Key Institutional Players

There is a growing list of key institutional players that are genuinely interested in RWA tokenization’s potential to shape the global investment landscape. According to a recent Coinbase report, 35% of Fortune 500 companies are gravitating towards tokenization projects. Below are some of the key players shaping the future of tokenized assets:

BlackRock

World's largest asset manager, BlackRock, announced its foray into RWA tokenization through its BUIDL fund. A significant investment in the US tokenized treasuries. Now worth over $600 million, BlackRock's BUIDL fund allows investors to invest in tokenized US treasuries, which is a game changer for fund management and the institutional adoption of blockchain technology.

MakerDAO

MakerDAO is the company behind DAI, an overcollateralized stablecoin, and a key player in the RWA space. It recently announced a $1 billion investment in the US tokenized treasuries.

Goldman Sachs

As a leading investment bank, Goldman Sachs has demonstrated a visionary leadership financial innovation through its proposed tokenization of institutional-grade assets targeting the US and EU markets. It seeks to provide institutional clients with investment options in tokenized securities, real estate and commodities.

Coinbase

As a leading crypto exchange, Coinbase is spearheading a major foray into RWA tokenization. It recently entered a partnership with eNor Securities to offer tokenized assets to retail investors in Latin America, as part of its broader expansion strategy in the region.

Market Predictions

Market predictions are consistently estimating trillions of dollars of tokenized assets by 2030 and beyond.

In a recent report by the Tokenized Assets Coalition (TAC), Mckinsey & Company, Boston Consulting Group(BCG) and Citibank predicted that there will be $2, $16 and $5 Trillion worth of tokenized assets by 2030, while Standard Chartered estimated that the total market size will grow to $30 Trillion by 2034.

Latest Development: Brickken Partners With BNB Chain For RWA Tokenization

Brickken, a leading RWA tokenization company, recently announced its collaboration with BNB Chain. This makes Brickken an official provider of RWA tokenization services within the BNB ecosystem. Brickken has  continued to record giant strides in the RWA space. In May, it was selected as one of the 11 participants of PricewaterhouseCoopers’ RWA Tokenization Cohort – out of 700 applicants .

The partnership with BNB Chain, one of the leading blockchains, will allow it to leverage BNB’s while taking maximum advantage of its low transaction costs, high scalability and to provide secure, cost effective solutions to investors and businesses seeking to tokenize real world assets on the protocol's platform.

Additionally, BNB Chain's vast DeFi ecosystem consisting of decentralised applications provides Brickken with market access thus increasing liquidity by opening up access to both retail and institutional investors.

Following the announcement, Brickken was chosen by Hydrokken, a clean energy tokenization project, to tokenize its shares in natural hydrogen amplifying the potential of RWA tokenization in driving clean energy initiative.

Conclusion:

Real world asset(RWA) tokenization offers new ways to invest in real-world assets like real estate, commodities, and government bonds. Stablecoin has emerged as the leading use case for RWA tokenization, controlling over 90% of the total market share.

Other sectors in the RWA space such as real estate, commodities, and tokenised treasuries have continued to attract significant attention, especially from traditional institutional like Goldman Sachs and BlackRock, which recently announced their foray into the brave new world of RWA tokenization.

This year, the RWA space has experienced significant growth thanks to the surging market capitalization of stablecoins. Traditional institutions have also contributed enormously to its growth success through their investments, partnerships and confidence in the potential of blockchain technology to shape the future of finance.