2024 Public Chain RWA Annual Research Report - Market Deconstruction and Paradigm Shift

In 2024, the public chain RWA is experiencing explosive growth, heralding the rise of a new financial paradigm. Driven by the triple engines of institutional entry, continuous technological breakthroughs, and gradually clarified regulations, RWA is accelerating from proof of concept to large-scale application. Innovative models such as asset tokenization, cross-chain interoperability, and smart contract automation are emerging, reshaping the financial ecosystem. However, structural issues such as liquidity stratification, yield-risk mismatch, and legal challenges regarding asset control cannot be ignored. Looking ahead to 2025, innovations in asset classes, the evolution of technological paradigms, and the reconstruction of regulatory frameworks will become the three main themes of RWA market development, injecting new momentum into the healthy growth of RWA.

This article is contributed by RealtyX DAO community contributor Sanqing.

Ⅰ Data Panorama: From Scale Explosion to Structural Transformation

1.1 Total Breakthrough and Growth Differentiation

(Source: rwa.xyz)

• On-chain RWA total scale: Approximately $15.4 billion by the end of 2024 (excluding stablecoins), a year-on-year increase of about 80% (2023 data: approximately $8.6 billion)

• Growth differentiation characteristics:

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• U.S. Treasury Bonds: Year-on-year growth of approximately 415% ($769 million → $3.96 billion)

• Private Credit: Year-on-year growth of approximately 48% ($6.656 billion → $9.828 billion)

• Commodities and Other Assets: Year-on-year growth of approximately 32.6% ($1.16 billion → $1.537 billion)

• Real Estate Tokenization:

|---------------------------------------------------------------------------------------------------------------|-----------------|------------------|--------| | Institution | Benchmark Year Market Value | Target Year Market Value | Compound Annual Growth Rate | | aceanalytic | $2.81 billion (2023) | $11.8 billion (2031) | 19.9% | | spherical | $2.78 billion (2023) | $16.51 billion (2033) | 19.5% | | prophecy | $3.8 billion (2024) | $26 billion (2034) | 21.2% |

While the overall market is expanding significantly, different asset classes are showing clear growth differentiation: U.S. Treasury bonds have achieved extremely high growth due to their safe-haven properties and institutional adoption, while private credit and commodities reflect differentiated attention from market participants regarding risk, yield, and liquidity. Institutions hold an optimistic long-term outlook on real estate tokenization, expecting its compound annual growth rate to approach 20%, suggesting that digital transformation and improved asset circulation efficiency will drive this field towards large-scale implementation.

1.2 Market Structure Evolution

The 2024 RWA market presents a "dual-core drive, diversified expansion" pattern

• Dual-core drive: U.S. Treasury bonds (annual growth of 415%) and private credit (annual growth of 48%) together account for over 85% of the market, with the former benefiting from macro safe-haven demand and institutional entry, while the latter attracts allocation due to its high-yield characteristics.

• Diversified expansion: Traditional categories such as real estate and commodities are steadily growing, while emerging fields like ESG assets, art, and supply chain finance are accelerating their penetration, collectively supporting market diversification.

Behind this layered expansion is the synergistic effect of technology, capital, and regulation. Three major trends—liquidity reconstruction, large-scale implementation, and asset innovation—constitute the core narrative of market evolution.

Three Major Trends: From Liquidity Reconstruction to Ecological Prosperity

• Liquidity premium release: Blockchain reshapes pricing logic

• Technological empowerment: Around-the-clock trading and smart contracts reduce transaction costs by 30-90%, compressing liquidity premiums and enhancing RWA asset valuations.

• Positive cycle: Improved liquidity → attracts more issuers and investors → further reduces premiums, forming a market expansion flywheel.

• Large-scale application: Dual breakthroughs in institutions and infrastructure

• Traditional finance entry: BlackRock (BUIDL fund), Franklin Templeton, and others have launched compliant tokenized products, validating the RWA business model.

• Emergence of dedicated public chains: Layer 1s like Plume and Mantra provide compliant and efficient tokenization infrastructure.

• Pricing infrastructure: Chainlink oracles cover over 70% of on-chain RWA assets, addressing the challenge of real price anchoring.

• Asset diversification: "Core-boundary" layered evolution

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  • Core dominance: Treasury bonds and credit maintain a dominant position, but growth differentiation (415% vs. 48%) reflects differences in risk appetite.

  • Boundary expansion:

  • Digitalization of traditional assets: Real estate (19-21% CAGR) and commodities enhance liquidity through tokenization.

  • Emergence of new categories: Long-tail assets such as ESG, luxury goods, and IP are accelerating on-chain, while supply chain finance (e.g., accounts receivable tokenization) releases financing potential for SMEs.

These three major trends—liquidity reconstruction reducing transaction friction, institutional-level infrastructure enhancing credibility, and asset expansion releasing long-tail value—are jointly driving RWA towards deeper penetration. Among them, real estate tokenization, due to its comprehensive integration of the three trends, has become the most representative paradigm breakthrough.

Focus Area: Paradigm Breakthrough in Real Estate Tokenization

At the same time, although other subfields are relatively small in scale, they still demonstrate sustained market vitality, supporting the diversified development of the RWA ecosystem.

• Growth trajectory: According to the optimistic forecast from ScienceSoft, by 2030, the global tokenized real estate market could reach a massive $3 trillion, accounting for 15% of real estate managed assets. They state that although this market is still in its early stages in 2024, the increasing adoption of tokenization technology by property owners and the growth in investor demand further validate the rationale for issuing real estate tokens.

• Strategic value: By integrating liquidity enhancement, institutional compliance, and multi-scenario applications, real estate tokenization has become a typical representative of RWA transformation potential, consolidating its core position in the broader RWA ecosystem.

The main application scenarios for real estate tokenization include

|-----------|------------------------|-------------------------------| | Scenario | Model | Representative Cases | | Residential Real Estate Fractional Tokenization | Splitting residential real estate into affordable shares to lower retail investment thresholds | RealT, Estate Protocol | | DeFi Liquidity Integration | Combining with lending and staking protocols to release liquidity of collateralized assets | RealtyX | | Residential Mortgage Innovation | Tokenizing mortgage certificates to enhance financing flexibility | PropCap | | Value Logic: Breaking physical limitations through blockchain to achieve 24/7 global liquidity, releasing the value of existing assets. |||

Ⅱ Industry Driving Factors: Analysis of Three Driving Engines

2.1 Institutional Entry

Institutions not only view RWA as a new investment track but are also attempting to utilize public chains as underlying technology to optimize capital operations and enhance operational efficiency. The entry of institutions will accelerate market maturity, promote the improvement of industry infrastructure, and further expand the digital boundaries of real-world assets.

Strategic Layout of Traditional Financial Giants

• In March 2024, BlackRock launched the tokenized fund BUIDL based on the Ethereum network, primarily investing in cash, U.S. Treasury bonds, and repurchase agreements, providing qualified investors with opportunities to earn dollar returns. As of July 2024, assets managed by BUIDL have exceeded $500 million, making it one of the largest tokenized Treasury bond funds.

• Additionally, institutions such as Fidelity, JPMorgan, and Citigroup have also made strategic layouts in the RWA field.

Institutional Entry Promotes Standardization and Infrastructure Improvement

• The entry of institutions has not only brought funds and resources but has also promoted the standardization and infrastructure construction of the RWA market. By collaborating with blockchain projects, traditional financial institutions are exploring best practices for tokenizing real-world assets, facilitating market maturity.

• BlackRock's BUIDL fund collaborates with blockchain projects like Securitize and Maple Finance to ensure that tokenized products meet regulatory standards and provide on-chain credit markets, promoting the creation and trading of credit products. They have partnered with Circle to establish a USDC liquidity pool, achieving 1:1 real-time conversion between BUIDL and USDC, enhancing the liquidity of tokenized products.

• JPMorgan's Onyx digital asset platform utilizes a tokenized collateral network to achieve the tokenized ownership transfer of money market fund shares through blockchain, allowing asset management companies and institutional investors to pledge or transfer fund shares as collateral, improving capital efficiency.

2.2 Technological Breakthroughs

Compliance Breakthroughs

To ensure that blockchain applications comply with regulations such as anti-money laundering (AML) and know your customer (KYC), many projects are exploring embedding compliance mechanisms directly into blockchain systems. For example:

• Tokeny Solutions has developed the ERC-3643 token standard, which integrates identity management and transfer restrictions directly into the token smart contract, allowing issuers to perform investor qualification checks, KYC/AML checks, and compliance rules on-chain. For instance, BlocHome uses the ERC-3643 standard to issue tokenized real estate, enabling project parties to automatically verify investors' identities and ensure compliance with regulatory requirements. According to BlocHome, using the ERC-3643 standard has reduced compliance costs by 90%.

• Tether has launched the asset tokenization platform Hadron, providing risk control, asset issuance and destruction, KYC and AML compliance guidance, and supporting blockchain reporting and capital market management.

• Circle's Verite framework is an open-source identity verification solution designed to provide interoperable identity standards for the decentralized finance (DeFi) ecosystem. This framework allows users to prove their identity on-chain while maintaining control over their personal data, aiming to achieve dynamic binding of on-chain identity and real-world asset (RWA) holding limits.

Cross-Chain Interoperability

Blockchain interoperability refers to the ability to exchange information and value between different blockchain networks. Achieving cross-chain interoperability is crucial for promoting the collaborative development of the blockchain ecosystem. Currently, cross-chain communication protocols are emerging, aiming to securely connect different blockchain networks and alleviate the challenges present in a fragmented blockchain landscape. For example:

• Wormhole has launched the NTT framework, providing an open and flexible cross-chain solution that allows native assets to be seamlessly transferred between different blockchains without the traditional wrapped token model. This innovation eliminates the intermediary risks of wrapped tokens and enhances the integration efficiency of multi-chain liquidity.

• Chainlink has released the Cross-Chain Interoperability Protocol (CCIP), a new open-source standard designed to establish universal connections between hundreds of public and private chain networks, enabling cross-chain applications. CCIP addresses the fragmentation issue in the blockchain space by ensuring that data and assets can be securely transferred between different blockchain networks, facilitating seamless interaction among various tokenized assets.

Public Chain Infrastructure

Through smart contracts, RWA public chains can automatically execute compliance checks, transaction settlements, and profit distributions, thereby reducing intermediary costs, improving operational efficiency, and providing a borderless platform for global investors to facilitate cross-border capital flows. Below are two notable RWA-specific public chains.

Plume Network

Plume is the first full-stack Layer 1 public chain built specifically for real-world asset finance (RWAfi), aiming to achieve rapid tokenization and global distribution of real-world assets. Its composable EVM-compatible environment supports the access and management of various real-world assets.

• End-to-end tokenization engine: Simplifies the asset onboarding process through automated compliance checks, KYC/AML integration, and compliance templates.

• Interoperability hub: Its SkyLink cross-chain interoperability solution connects over 16 public chains (such as Solana and Movement), enabling users to enjoy institutional-level RWA yields across multiple chains without permission, promoting the development of a cross-chain RWA ecosystem.

• Ecosystem expansion: Plume has launched over 180 protocols covering real estate tokenization, private credit, commodities, and more. Its strategic partnership with rwa.xyz ensures comprehensive data analysis capabilities for on-chain RWA, providing users with industry-leading tokenized asset data.

Mantra

Mantra aims to provide a permissionless, high-performance, and scalable Web3 development environment, specifically tailored for compliant RWA applications:

• Compliance integration: Mantra is the first platform to obtain a DeFi VASP license issued by VARA, allowing it to legally operate a virtual asset exchange, brokerage, asset management, and investment services in Dubai, further consolidating the legitimacy of DeFi within a compliance framework.

• Real-world impact: Collaborating with DAMAC Group to tokenize $1 billion worth of Dubai real estate, enhancing liquidity for high-value properties.

• Developer-friendly: Provides SDKs and APIs for seamless integration of identity verification, asset custody, and cross-chain settlement.

2024 RWA Technology Stack Review

In summary, the tokenization technology stack for RWA in 2024 has achieved "three-layer decoupling," meaning the separation and collaborative development of the asset layer, protocol layer, and application layer.

• Asset Layer
  ERC-3643 Standard: Widely used for compliant equity tokenization. This standard integrates identity management and transfer restrictions directly into the token smart contract, allowing issuers to perform investor qualification checks and KYC/AML checks on-chain, ensuring the compliance of token transactions.

• Protocol Layer
  Chainlink's oracle network has made significant progress in the coverage of RWA price data sources.
  The Cross-Chain Interoperability Protocol (CCIP) supports seamless RWA cross-chain management, addressing inter-chain fragmentation issues and enhancing liquidity.

• Application Layer
  Lending: Maple Finance was the first to launch uncollateralized institutional loans, subsequently opening up to retail users through Syrup.fi (launched in June 2024). Defactor has also become a key player, providing on-chain lending solutions for RWA and retail users.
  SME Financing: Centrifuge tokenizes real-world receivables and invoices, releasing blockchain-based liquidity to assist SME financing.
  AMM Liquidity Provision: IX Swap enhances automated market maker (AMM) technology, promoting liquidity for tokenized assets.
  Secondary Market Trading: Polytrade promotes the development of the RWA secondary market, enabling efficient trading of tokenized assets.

This decoupled architecture allows each layer to evolve independently while maintaining seamless integration, thus accelerating RWA from niche experiments towards scalable institutional-level solutions.

2.3 Regulatory Game

In 2024, RWA has made significant progress globally, but the large-scale implementation of RWA relies on clear regulatory guidance and policy environments. Governments and international regulatory bodies are actively exploring how to promote the development of this emerging field while ensuring financial stability and protecting investor rights.

Divergence and Coordination of Global Regulatory Trends

• U.S. SEC: In 2024, the SEC clarified the regulatory framework for security tokens and tokenized assets, emphasizing that such assets must comply with existing securities laws. This move provides clearer guidance for the compliant operation of RWA. In response to the SEC's regulation of digital assets, some RWA project parties (such as RWA Inc.) are collaborating with compliance consulting firms to analyze the securities nature of their RWA tokens and take corresponding compliance measures based on the analysis results.

• EU MiCA: The EU has further supplemented regulatory provisions for RWA based on MiCA. MiCA categorizes stablecoins into asset-referenced tokens (ART) and electronic money tokens (EMT), setting clear requirements for their issuance and operation. Specifically, MiCA stipulates:

• Asset-Referenced Tokens (ART): Refers to crypto assets that aim to maintain stable value based on the value of one or more fiat currencies, one or more commodities, or one or more crypto assets. MiCA imposes higher capital requirements and stricter operational requirements on ART issuers to ensure they have sufficient asset reserves to support the value of the tokens.

• Electronic Money Tokens (EMT): Refers to crypto assets that aim to maintain stable value based on the value of one fiat currency. EMT issuers must obtain licenses from electronic money institutions and comply with relevant regulatory requirements.

• Asian Regulatory Sandboxes:

• Japan: The revised Payment Services Act clarifies the regulatory positioning of stablecoins as "electronic payment tools."

• Hong Kong and Singapore: By issuing regulatory guidelines and sandbox programs, they provide clear compliance pathways for innovative products like RWA.

Balancing Regulation and Innovation

• Dynamic regulation and sandbox mechanisms: Several countries have adopted "regulatory sandbox" models, allowing companies to experiment with new technologies and business models within a limited scope while collecting data to adjust policies. For example, the sandbox program launched by the Hong Kong Monetary Authority provides a testing platform for digital asset products like stablecoins, ensuring compliance without hindering innovation.

• Cross-border regulatory coordination: As the RWA and other digital asset markets globalize, regulatory agencies in various countries are attempting to promote unified regulatory standards within international organizations (such as FATF, G20), which will help alleviate cross-border regulatory conflicts and information asymmetry issues.

Ⅲ Market Paradox: Structural Contradictions Beneath Prosperity

3.1 Liquidity Stratification Phenomenon

The original intention of RWA tokenization is to enhance asset liquidity through blockchain technology, enabling assets to be traded in the market more quickly and transparently. However, in practice, there is significant stratification in liquidity among different types of assets:

• Differences in Asset Nature and Market Scale:

• Differences in intrinsic asset attributes. For example, tokenized U.S. Treasury bonds have the backing of national credit, a mature trading market, and high-standard credit ratings, resulting in high liquidity due to their active trading, transaction volume, and price discovery mechanisms. In contrast, assets like real estate and art often have complex valuations, limited investor demand, and restricted trading methods, leading to high holding costs and long exit cycles, resulting in insufficient liquidity.

• Market scale and participant structure. High liquidity assets typically attract a large number of institutional and retail investors, and with sufficient market depth, buyers and sellers can achieve rapid matching at any given time. Conversely, low liquidity assets may form information islands, with fewer investors, sparse buy and sell orders, leading to low trading volumes, high price volatility, and difficulty executing large transactions without significant slippage.

• Market Participant Behavior and Expectation Management:

• Preference for high liquidity assets. Investors generally prefer assets that are easy to liquidate and have low transaction costs, particularly evident during periods of high market enthusiasm. The trading activity of high liquidity assets further attracts more participants, while low liquidity assets may become marginalized, forming a "survival of the fittest" market structure.

• Liquidity premiums and price volatility. Assets with better liquidity often enjoy a certain premium, while low liquidity assets may face significant discounts when urgently liquidated due to a lack of sufficient trading counterparts, exacerbating price volatility and market risk.

To address this issue, many RWA project parties are taking the following measures:

• Introducing Market Maker Mechanisms: Encourage market makers to provide liquidity for low liquidity assets by offering buy and sell quotes, narrowing bid-ask spreads, and increasing trading activity.

• Integrating DeFi Protocols: Combine RWA with DeFi protocols, such as using RWA as collateral for lending or including RWA in DEX trading pairs. Through DeFi protocols, RWA liquidity can be enhanced, providing investors with more yield opportunities.

• Incentivizing User Participation in Trading: Encourage user participation in trading low liquidity assets through airdrops, trading competitions, and other methods.

3.2 Yield-Risk Mismatch Crisis

While RWA offers investors diverse yield opportunities, behind the attractiveness of yields often lies the issue of yield and risk mismatch:

• Insufficient risk disclosure and transparency
  Traditional financial markets require strict information disclosure and regular risk assessment reports, but during the RWA tokenization process, some platforms have yet to establish unified and transparent risk assessment and information disclosure standards. The lack of sufficient risk warnings makes it difficult for investors to timely understand the credit status of assets, collateral quality, and market volatility.

• Disconnection between asset backing and actual risk-bearing
  In many tokenization projects, to achieve digital asset management, SPVs (special purpose vehicles), trust funds, or third-party custodians are often established to hold the assets. However, if these structural designs have flaws, in the event of bankruptcy or default, the tokens held by investors may not correspond to the actual assets, exacerbating the yield-risk mismatch. High-yield products often come at the cost of higher default probabilities and credit risks, and some products in the RWA market may cause investors to underestimate potential credit risks due to opaque marketing or ratings, leading to substantial losses when default events occur.

• Fluctuations in market sentiment and risk premiums
  Traditional financial markets typically have various risk mitigation tools (such as credit default swaps, guarantee mechanisms, etc.) to balance risk and yield, but in many RWA tokenized products, such tools have yet to be fully developed and applied, making the mismatch between yield and risk more pronounced. In decentralized trading environments, token prices are more influenced by short-term market sentiment and liquidity fluctuations. When market sentiment is optimistic, high-yield assets may be overly sought after, with prices far exceeding their fundamental support; however, once the market cools or unexpected risk events occur, prices can plummet, causing investors to enter at peaks and exit at troughs, further exacerbating risk mismatches.

3.3 Legal Paradox of Asset Control

In the process of RWA tokenization, the control of assets forms an inherent paradox between the legal system and the technical framework. This paradox mainly manifests in three aspects: the dilemma of rights confirmation, the failure of bankruptcy isolation, and cross-national judicial conflicts, leaving token holders facing a "triple rights suspension" dilemma.

• Dilemma of Rights Confirmation: Blockchain technology provides a decentralized ledger that can ensure the uniqueness and transferability of tokens through cryptographic techniques. However, the ownership of real-world assets relies on traditional legal confirmation systems, such as property registration, corporate equity structures, and custody agreements. Therefore, the ownership of RWA may produce a disconnect between on-chain registration and off-chain confirmation.

• Smart Contracts vs. Real-World Law: Although token holders possess ownership certificates on-chain, without corresponding legal recognition, these rights may not withstand claims from third parties. For instance, in real estate tokenization projects, even if one holds tokens, if formal property registration has not been completed, token holders may not be recognized as actual asset owners under current laws.

• Smart Contract Automation vs. Judicial Intervention: In judicial litigation, courts may rule to freeze or redistribute assets, while the automated execution logic of smart contracts may not effectively comply with legal orders, leading to conflicts between the legal system and technical framework. This means that even if on-chain transactions have been completed, courts may still declare those transactions invalid or revoke them.

• Failure of Bankruptcy Isolation: Tokenized assets typically require management by an entity (such as an SPV, trust fund, or custodian), and once that entity goes bankrupt, token holders may face:

• Unclear Asset Ownership: In traditional financial systems, securities, trust assets, etc., are usually protected by bankruptcy isolation mechanisms, meaning that even if the managing party goes bankrupt, the assets of holders will not be used to pay off debts. However, in the practice of tokenized RWA, if the legal structure of the asset custodian is unclear, token holders may face the risk of their assets being seized by courts or used to pay off debts.

• Token Rights May Be Viewed as Unsecured Claims: If regulatory agencies or courts determine that tokens are merely "mappings" of assets rather than direct ownership certificates, token holders may not enjoy priority repayment rights in bankruptcy liquidation and may only queue as ordinary creditors for repayment. This would severely undermine the credit foundation of RWA assets as financial instruments.

• Cross-National Judicial Conflicts: RWA tokenization often involves multiple jurisdictions, such as the location of the asset, the place of token issuance, and the location of investors, and conflicts between laws in different countries may lead to uncertainty regarding the rights of token holders.

• Differences in Legal Recognition of Asset Ownership Across Jurisdictions: Some countries' laws consider digital assets as legitimate property protected by property law, while in others, they may only be viewed as contractual rights or note rights, subject to different legal frameworks. Therefore, investors may face legal protection issues for their tokenized assets in these countries due to differing legal interpretations.

• Cross-Border Law Enforcement Issues: Suppose an investor holds a tokenized gold asset issued on the blockchain, but the gold is stored in a bank vault in another country. If the two countries have different interpretations of gold ownership, the investor may be unable to effectively enforce their ownership claim. Additionally, there are technical barriers to executing court orders for freezing or seizing assets on the blockchain.

Ⅳ Future Projections: Three Major Trends of RWA in 2025

4.1 Asset Class Revolution

1. The Wave of Non-Standard Assets Going On-Chain: As the RWA market continues to expand, private credit and U.S. Treasury bonds are expected to maintain their dominant positions due to their excellent liquidity and credit ratings. However, non-standardized assets, particularly real estate in developed regions or rapidly growing economies, will see significant on-chain progress by 2025.
   According to Bitwise's forecast, by the end of 2025, the RWA market size will reach $50 billion. Among them, the Security Token Market predicts that tokenized real estate will reach $1.4 trillion, while Roland Berger predicts that real estate will account for nearly one-third of the market share. Roland Berger's forecast indicates that real estate is expected to become the largest type of tokenized asset by 2030, accounting for nearly one-third of the market. This is mainly due to the maturity of blockchain technology and the increasing demand for RWA, as these traditionally illiquid assets expect to achieve more efficient trading and management. (Source: Roland Berger)
2. Large-Scale Fusion Innovation of RWAFi: Before the real world formally enters the Web3 era, the development of RWA mainly stems from the demand for liquidity in traditional finance. However, as RWA goes on-chain, this process is not just about asset digitization but also about deep integration with DeFi and other blockchain finance. This fusion has given rise to a powerful "RWA + any 'Fi'" model, promoting diversity and depth in financial innovation. The combination of real estate tokenization and DeFi is an important direction for RWAFi fusion innovation. By tokenizing real estate assets and integrating them with DeFi protocols, the following innovative applications can be achieved:

• Mortgage Loans: Using tokenized real estate as collateral to obtain loans from DeFi lending platforms (e.g., using a tokenized apartment as collateral to secure a stablecoin loan).

• Yield Farming: Token holders can deposit RWA tokens into DeFi protocols to earn interest income (e.g., loan repayment income) or protocol rewards (e.g., governance tokens). Unlike passive holding, yield farming actively optimizes asset returns.

• Liquidity Mining: Users can provide liquidity for RWA token trading pairs on decentralized exchanges (DEXs) to earn trading fees and liquidity incentives, with returns proportional to the liquidity provided.

Case Study: RealtyX, Plume Network, and Ecosystem Partners

RealtyX (a real estate tokenization platform) and Plume Network (an L1 public chain built for RWA) are driving the implementation of the RWAfi innovation framework:

• Tokenization: RealtyX tokenizes real estate (e.g., Dubai residential properties) through the Plume blockchain, ensuring compliance and cross-chain interoperability.

• Mortgage Loans: Token holders can use RealtyX tokens as collateral to obtain loans on integrated lending platforms (e.g., Defactor, Mystic Finance) within Plume.

• Yield Farming: By combining RealtyX's real estate tokens with Pendle's yield tokenization protocol, users can create tradable future rental income tokens to optimize investment returns.

• Liquidity Mining: RealtyX tokens can be paired with stablecoins to form liquidity pools for trading on DEXs (e.g., Rooster Protocol), with liquidity providers receiving native token incentives from RealtyX and Plume.

4.2 Technological Paradigm Shift

• Adoption of Zero-Knowledge Proof Technology
  Zero-knowledge proof (ZKP) technology has shown great potential in various fields of Web3. In the RWA space, the application of ZKP can enable asset verification and transactions while ensuring data privacy. This is particularly important for on-chain transactions involving sensitive information (e.g., real estate, private credit), enhancing the security and credibility of transactions.

• Adoption of Modular Blockchains
  Modular blockchain architecture has demonstrated advantages in enhancing network performance and scalability in other Web3 fields. In the RWA space, the adoption of modular blockchains can facilitate the flexible combination of different functional modules to meet the diverse needs of asset tokenization. This will promote the standardization and interoperability of RWA, lowering the technical barriers and costs of going on-chain. For reference, Plume Network has attracted over 180 RWA-related protocols and over 300,000 user addresses in its testnet, generating hundreds of millions of transactions.

4.3 Reconstruction of Regulatory Framework

• Shift in U.S. Regulatory Policies
  Given the Trump administration's friendly stance towards cryptocurrencies and the accelerated entry of U.S. institutions into the RWA field, it is foreseeable that the U.S. will adopt a more open posture regarding the regulation of crypto assets. Policies and regulations supporting RWA tokenization are expected to be introduced, encouraging financial innovation while ensuring market stability and security. This will provide a clearer legal framework for the development of RWA, reducing compliance risks and attracting more institutions and investors to participate.

• Unified Cross-Border Regulation
  Although this is not a major trend for 2025, as RWA continues to explode, especially with the anticipated surge in non-standard assets, there may be several cross-border lawsuits related to RWA this year, particularly concerning non-standard assets. This will prompt regulatory agencies in various countries to begin considering the formulation of a unified international regulatory framework to address legal and compliance issues in cross-border transactions.

Conclusion: The Growing Pains of RWA Towards Institutional Maturity

In 2024, RWA tokenization has transitioned from concept to reality, gradually entering a phase of scalable application driven by accelerated institutional investment (such as BlackRock's BUIDL), regulatory breakthroughs, and infrastructure upgrades (such as Plume Network's RWA-specific L1). However, as tokenized assets like Treasury bonds, real estate, and private credit grow, the industry still faces a series of structural challenges.

Core Challenges

1. Centralization Dilemma: The Conflict Between Compliance and Decentralization

• Many RWA protocols rely on "permissioned DeFi" models (such as custodians, SPVs) to meet compliance requirements, which conflicts with the decentralized philosophy of blockchain.

• The legal ownership of assets remains constrained by traditional legal frameworks, limiting the autonomy of smart contracts in dispute resolution.

1. Decentralization Gap: Barriers to Entry and Regulatory Obstacles

• There is a conflict between lowering investment thresholds and KYC/AML compliance, lack of transparency in information disclosure, and high technical barriers.

• Although DAO governance has potential, it still faces challenges of low participation and regulatory uncertainty.

1. Market Fragmentation: Uneven Distribution of Liquidity

• Liquidity is concentrated in blue-chip RWA assets (such as U.S. Treasury bonds), marginalizing niche assets.

• Cross-border legal uncertainties threaten the enforceability of ownership claims for tokenized assets, increasing investment risks.

Path to Resolution: Collaboration Over Compromise

To achieve the global development of RWA, all parties in the industry need to focus on promoting the following directions:

1. Seamless Interoperability
   By leveraging Plume Network's RWA-specific L1 and RealtyX's DeFi integration, bridge the traditional finance and blockchain worlds, reducing asset flow resistance.

2. Embedded Compliance
   Embed KYC/AML mechanisms at the protocol level (such as zero-knowledge proof identity verification) to ensure compliance while protecting user privacy, proving that compliance should not be an obstacle to innovation.

3. Global Governance Alliance
   Collaborate with institutions like FATF and BIS to promote the unification of cross-border regulatory standards, ensuring that the rights of tokenized assets are legally protected in cases of bankruptcy, judicial conflicts, and more.

4. Education to Promote Popularization
   By providing more user-friendly interfaces (such as RealtyX's retail-friendly Dapp), lower the usage barriers for ordinary users, and enhance market transparency through Chainlink's asset-level oracles.

Blueprint for Responsible Scalable Development

The rise of RWA is not about replicating traditional finance but about reshaping trust:

• For institutions: Achieve 24/7 liquidity, allowing previously illiquid assets to enter the global market.

• For individual investors: Expand market access, such as Dubai real estate and Asian private credit.

• For developers: Projects like RealtyX are validating that decentralized and real-world financial frameworks can coexist compatibly.

The infrastructure has been established, and industry trends are irreversible. Now, the key lies in how to execute efficiently— the industry needs to adopt a rigorous attitude and an inclusive perspective, focusing on the future to truly drive RWA towards institutional maturity.