The global focus on real-world asset (RWA) tokenization surged in 2024, with the on-chain value of RWA assets surpassing $13 billion, according to data from rwa.xyz at the time of writing.
Industry analysts and recent reports predict exponential growth for this sector, which is reshaping traditional finance.
A recent Tren Finance study suggests the market could expand more than 50-fold by 2030.
Zachary Nelson, growth lead at Tren Finance, told Cryptonews that the tokenization sector’s growth trajectory appears extremely promising.
“Major institutions project market sizes for RWA assets will range from $2 trillion to $30 trillion by 2030,” Nelson said.
The Rebirth of RWA Tokenization in 2024
Experts agree that the RWA tokenization space has undergone a significant transformation throughout 2024.
Margaret Rosenfeld, chief legal officer of fintech platform Tilt, told Cryptonews that the past few years saw limited progress in tokenization projects due to the crypto bear market and negative U.S. regulatory trends.
“This was coupled with the negative U.S. regulatory headwinds over the last two years,” Rosenfeld said.
However, she pointed out that improved regulatory sentiment in the U.S. and the ongoing bull market have sparked what she described as a “rebirth of tokenization.”
Bhaji Illuminati, chief marketing officer of Centrifuge, described 2024 as a pivotal year for RWA platforms.
“A perfect storm of converging forces makes RWA platforms not just attractive, but perhaps inevitable,” Illuminati told Cryptonews.
Illuminati believes that traditional finance giants — like BlackRock and Janus Henderson – are also responding to a fundamental shift in how institutional capital views the crypto industry. “Not as a speculative bet, but as an efficiency play,” she said.
How the U.S. Presidential Election Influences RWA Tokenization
According to Illuminati, the election outcome has re-energized the decentralized finance (DeFi) space with a number of expected upcoming regulatory changes.
“This includes stablecoin legislation, which would bring clear and substantial benefits to the RWA space,” she said. “As regulatory guardrails take shape, they will lower perceived risks, paving the way for RWAs to integrate more deeply with both DeFi and TradFi frameworks.”
And while the crypto bull market happens to be in full swing, Illuminati noted that the RWA platform surge is less about market conditions and more about technological and regulatory readiness.
“After years of infrastructure building and lessons learned from previous DeFi cycles, paired with regulatory tailwinds, we’ve finally reached a point where the technology can truly deliver on the promise of tokenized real-world assets at scale,” she said.
New Trends Driving RWA Tokenization Forward
The surge in RWA tokenization is also being demonstrated by leading Web3 companies.
The topic of tokenization was particularly apparent at the Hedera Forum – an event hosted by the decentralized public network Hedera — that took place in Miami on Nov. 13.
Charles Adkins, president of Hedera, told Cryptonews that Hedera chose to focus on tokenization because the platform is purpose built for this.
“Hedera’s hashgraph consensus provides the speed, fairness, and security required to achieve tokenization goals,” Adkins said. “Purpose-built tools like the ‘Hedera Token Service’ and ‘Asset Tokenization Studio’ offer a trusted foundation for securely scaling RWA tokenization, as demonstrated by successful use cases across multiple sectors.”
Although Hedera launched in 2017, the platform’s tokenization features appear to be taking off this year.
Edward Nwokedi, CEO of RedSwan, spoke about real estate tokenization during the “Unlocking RWA Value” panel at the Hedera Forum.
Source: Cryptonews / Edward Nwokedi, CEO of Redswan, and Other Panelists Discuss Rwa Tokenization at Hedera Forum 2024
Nwokedi mentioned that RedSwan works with Hedera leadership to integrate $280 trillion worth of tokenized real estate shares.
“We are building a fully functional, compliant business ecosystem that can be 25%-40% more efficient,” Nwokedi told Cryptonews. “We are fully focused on real estate and very soon will be minting a substantial amount of registered real estate security tokens locked on Hedera.”
Nwokedi also explained the benefits of tokenization in the real estate industry, noting how blockchain provides strategic leverage over traditional applications.
“Tokenization allows for the openness to unlimited options within the real estate industry, transmitting transactions at high speeds,” he said. “Institutions are front and center in deploying resources for adoption and implementation this year.”
Tether Launches Tokenization Platform
While tokenization was a hot topic of discussion at the Hedera Forum, stablecoin issuer Tether recently revealed an RWA tokenization platform dubbed “Hadron.”
Paolo Ardoino, CEO of Tether, announced on social media platform X that Hadron by Tether is, “Tether’s new platform as a service that encapsulates all tokenization tech that Tether built in the last 10 years in a product available for institutions and professionals.”
Ardoino added that while Hadron has launched as a private beta, the product has already gained the attention of “many companies, institutions and governments during the last months, receiving extremely positive feedback.”
The Tether CEO also noted that this demonstrates the beginning of a new era for finance.
Key Trends in Tokenization for 2024
Illuminati identified several key trends shaping the RWA tokenization landscape this year. One notable shift is the move from asset tokenization to process tokenization.
“It’s not just about creating a digitized version of an offchain asset,” she said. “It’s about re-imagining the entire workflow onchain.”
This shift creates “operational alpha,” or value derived from the efficiency of managing assets and integrating DeFi tools.
Additionally, Illuminati highlighted the emergence of flexible compliance layers that adapt to various jurisdictions and investor needs.
“Early platforms forced a choice between being fully permissionless or fully regulated,” she explained. “Now, dynamic systems are evolving to cater to diverse regulatory frameworks.”
Another key trend is the growing interconnectivity between networks, which unlocks utility and liquidity for tokenized assets.
Overcoming Challenges in Tokenization
While 2024 has been a pivotal year for RWA tokenization, education remains a barrier to widespread adoption.
Edward Nwokedi noted that traditional financial organizations have yet to invest substantially in blockchain education.
To address this, Centrifuge co-created the Tokenized Asset Coalition (TAC), a group working to accelerate adoption.
“TAC has a bold mission of bringing the next trillion dollars of assets onchain. In order to do so, it operates at multiple levels, from educating investors to facilitating regulatory discussions, essentially creating an ecosystem-wide translation layer between traditional and decentralized finance,” Illuminati said.
Illuminati believes that the ecosystem’s success hinges on network effects. “Each new participant, whether an issuer, investor, or service provider, makes the ecosystem more valuable for everyone else,” she said.
As RWA tokenization continues to evolve, its integration into traditional and decentralized finance systems is expected to redefine the global financial sector.
The post The Crypto Community Witnesses a Rebirth of RWA Tokenization in 2024 appeared first on Cryptonews.
