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We all witnessed the potential of tokenization of RWAs in 2023 and this trend further exploded in 2024. Blackrock introduced BUIDL, a tokenized fund on Ethereum and achieved an AUM of ~ $500 Mn within 4 months of its launch. Franklin Templeton unveiled an on-chain fund backed by short-term treasuries and repurchase agreements, which also quickly grew to ~ $500 Mn in AUM. Ondo Finance’s USDY, a tokenized treasury fund, amassed ~ $440 Mn in AUM, while the ONDO token became one of the year’s standout launches, surging ~ 700% since listing.
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Tokenized Government Securities
The tokenization of government securities emerged as a major trend as its AUM increased by ~ 260% and stood at ~ $3.2 Bn as of Dec ‘24, primarily driven by entry of giants like Franklin Templeton, Blackrock and more.
Holders of Tokenized Assets
The holders of tokenized assets have grown at a CAGR of ~ 37% over the last few years and stood at ~ 69 Mn as of Dec’ 24. Notably, 99% of these holders own stablecoins, as other use cases for tokenized assets are still in their early stages of development and adoption.
Rise of Private Credit
The cumulative loans originated from private credit protocols increased by ~ 50% from ~ $6 Bn to ~ $9 Bn, primarily driven by ease of access for SMEs when compared with the hurdles faced in the TradFi domain and higher yields for liquidity providers.
Preferred Blockchain
Ethereum emerged as the preferred blockchain for tokenization of RWAs with a market share of ~ 80%, followed by Stellar (6%), Polygon (3.5%), and Solana (3.2%).
Outlook for 2025
The RWA sector looks poised for significant growth in 2025. The advancements in blockchain technology such as account abstraction, RWA specific blockchains like Plume, which raised ~ $20 Mn in Dec ’24, will help RWA protocols in ushering mass adoption.
The increasing involvement of institutional giants like JPMorgan Chase, HSBC, BlackRock, and Goldman Sachs is likely to bring in more institutional capital and improve the regulatory scenario to foster an environment that supports broader adoption.
Beyond market dynamics, RWA projects still continue to encounter significant legal and regulatory obstacles. While regulatory frameworks are evolving, inconsistencies across jurisdictions persist. Overcoming these hurdles will be crucial for attracting broader project participation.
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Our comprehensive report, “Crypto Outlook 2025”, provides an in-depth analysis of the evolving crypto landscape. It features deep insights into key verticals, & emerging narratives, along with expert opinion on different sectors.
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