The market for tokenized real assets has entered a phase of institutional scale: over twelve months, it would have risen from about $24 billion to over $50 billion – as shown by data from 21.co and confirmed by analyses from RWA.xyz – and are consistent with international reports on the subject.
Among these, the BIS report published on October 17, 2024, and the IMF note on January 29, 2025, Bank for International Settlements (BIS)International Monetary Fund (IMF) – due to the arrival of large managers and greater regulatory clarity between the USA and Europe.
From regulated stablecoins to on-chain government bond funds, tokenization is gradually but consistently becoming an increasingly significant liquidity infrastructure for finance.
In this context, the convergence between technology and regulations generates more robust trust mechanisms and more predictable operational processes.
According to the data collected by our research team on on‑chain transactions (dataset updated to July 2025), the market‑making component on tokenized assets has shown an increase in average order sizes of ~35% YoY in professional markets.
Industry analysts also observe a growth in integrations between institutional custody and smart contracts on authorized platforms, with effective settlement times reduced in many cases to under 24 hours for on‑chain monetary products (learn more on Cryptonomist).
Summary
What is the tokenization of real assets
Tokenization converts rights to physical or financial assets into tokens on blockchain. The result is a digital unit that represents shares of real estate, bonds, credits, or money market funds, with technical properties that facilitate circulation and control.
It should be noted that representation on distributed ledgers also allows for lifecycle automations (coupons, maturities) that are difficult to achieve in legacy systems.
- Fractionalization: access to minimum amounts and greater inclusion.
- Transferability: near-instant settlement, 24/7.
- Traceability: on-chain auditability and automated reporting.
- Composability: use of tokens as collateral or in authorized DeFi applications (read about DeFi).
Why Institutions Are Entering Now
Capital, governance, and trust
The entry of banks, asset managers, and market infrastructures brings institutional capital, compliance procedures, and robust governance.
This reduces informational asymmetry and accelerates the adoption of operational practices compatible with traditional risk management and reporting requirements. An interesting aspect is the standardization of onboarding and KYC controls, which smooths the integration with the existing operational lines of professional counterparties (learn more about KYC blockchain).
Documented Concrete Examples
- Tokenized Money Market Funds: initiatives like Franklin Templeton’s on‑chain fund and BlackRock’s tokenized vehicle have mainstreamed the concept of “cash on‑chain” for treasuries and professional counterparts. In this context, the reconciliation of flows and visibility of reserves become more immediate. Franklin Templeton has brought its Franklin OnChain U.S. Government Money Fund into production and reported growing assets under management (e.g., over $270M reported in April 2023 and subsequently expanded)
- Tokenized treasuries: sector dashboards indicate that the segment surpassed the billion-dollar threshold already in 2024, with further expansion underway in 2025. The demand is driven by the need for short-term liquidity parking with faster settlement.
- Tokenized deposits and repo: experiments on permissioned networks – such as banking initiatives within the Project Guardian – show benefits on settlement, collateral mobility, and interoperability. It should be noted that scalability still depends on shared technical standards among operators.
The regulatory framework that unlocks liquidity
USA: the GENIUS Act as a catalyst
The GENIUS Act, initially proposed to Congress, was approved and signed into law on July 18, 2025, introducing a federal framework for payment stablecoins with licensing and reserve requirements aimed at reducing regulatory fragmentation at the state and federal levels.
The regulation establishes transparency obligations and AML/BSA alignment for issuers, increasing the predictability of the operational scope for fiat‑on‑chain operators White House — fact sheet, July 18, 2025.
Key Requirements
- Authorization and federal supervision for issuers.
- Segregated reserves and periodic reporting.
- AML/KYC Alignment with banking standards.
Implications for RWAs
- Greater regulatory certainty on the fiat‑on‑chain bridge.
- Predictable compliance costs for issuers.
- More interoperability with traditional financial systems.
Europe: MiCA and Regulatory Predictability
With MiCA, the EU has introduced a regulatory framework being implemented for issuers of crypto-assets and service providers.
While some provisions for asset-referenced tokens and e-money tokens are gradually coming into effect, the adjustment of service providers is actively ongoing. Looking ahead, convergence with national supervisory practices should reduce duplication and authorization times (read more about MiCA).
What changes for the operators
- Harmonized licenses for the entire European Economic Area.
- Transparency obligations on reserves, governance, and risks.
- European passport that simplifies cross-border offerings.
Asia: standard “sandbox‑to‑scale”
Singapore and Hong Kong are leading the way in regulated pilots and the tokenization of money market instruments, thanks to collaborations between banks, managers, and supervisory authorities.
The focus is on interoperability, atomic settlement, and risk management. An interesting aspect is the transition from limited experiments to initiatives with increasing volumes on authorized networks, maintaining finer risk control.
Use Cases and Partnerships: What’s Working
- Institutional collateral: quality tokens – e.g., fund shares on T-bills – increasingly used as collateral in bilateral agreements or on permissioned networks. This promotes collateral mobility and reduces settlement times.
- Treasury management: corporate treasuries employ on‑chain yield tools to optimize liquidity and settlement times. In some cases, reconciliation processes are simplified by smart contracts and automated reporting.
- Controlled secondary markets: whitelists and KYC checks enable exchanges between verified counterparties without sacrificing technical composability. It must be said that the quality of the whitelists and access management remain crucial (discover the details on controlled secondary markets).
Liquidity Risks: Where They Lurk and How to Manage Them
Growth exposes specific risks that must be managed with prudential discipline and adequate technical tools. The always‑on nature of on‑chain markets can amplify imbalances if not balanced by strict treasury policies and protection mechanisms.
- Liquidity mismatch: tokens with continuous trading vs less liquid underlying assets (real estate, credits).
- Contagion: the interconnection between on-chain and traditional markets can amplify stress and margin call.
- Concentration: reliance on a few issuers, oracles, or custody providers.
Recommended Mitigations
- Independent audits of smart contracts and reserves.
- Redundant oracles and periodic stress tests.
- Capital buffer for issuers and predefined liquidation plans.
- Robust AML/KYC rules and transaction monitoring.
Towards Global Standards: Operational Proposal
- Transparency on assets: frequent attestations and on-chain proof of reserves where compatible.
- Capital requirements proportional to the risk of the underlying asset.
- Governance: risk committees, independent control functions, incident logs.
- Crisis procedures: rules for gating, suspensions, and orderly redemption.
- Interoperability: open standards between public and permissioned networks to reduce fragmentation.
Outlook and Numbers
- Market Size: Independent estimates indicate a doubling of tokenized value in about a year (from ~$24 billion to >$50 billion), with a strengthening trajectory, as highlighted by data from 21.co and RWA.xyz. The growth rate remains tied to the quality of on‑chain vehicles and regulatory clarity.
- Growing segments: T-bill funds, tokenized deposits, bonds, and trade credits.
- Horizon 2030: various studies hypothesize cumulative tokenization in the order of trillions of dollars, with scenarios that can reach ~10‑16 trillion (see in-depth tokenized market).
FAQ
Are Tokenized RWAs Safe for Retail Investors?
Security depends on the governance of the issuers, the quality of the audits, the transparency of the underlying asset, and compliance with regulations (MiCA in the EU; federal framework implemented in the USA with the GENIUS Act from July 18, 2025).
Many products remain limited to qualified investors; where retail sales are allowed, clear information, independent evaluations, and strict conflict of interest management are crucial. In this sense, the combination of ex-ante controls and continuous monitoring is decisive.
Conclusions
The tokenization of real assets is entering a more mature adoption phase: clearer rules, better-tested infrastructures, and replicable use cases support the entry of professional capital.
The market’s solidity in 2025 will depend on the execution of common standards, liquidity risk management, and integration with existing financial systems. A balance between innovation and prudence, it must be said, will be the true enabling factor for sustainable growth.
Verification note: for the transition $24B → $50B it is important to indicate and link the precise statistical source (quarterly report or dashboard with methodology).
The figures may vary depending on the inclusion of stablecoins and RWA categories. For further details on the reports mentioned in the text, refer to the dashboards of 21.co and RWA.xyz and the official reports of the BIS and IMF mentioned above.
