What are Real-World Assets (RWAs)?
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Real-world assets (RWAs) are crypto tokens backed by traditional assets. Issuers of RWAs take an existing asset — such as gold, fiat currency, stocks or bonds — and create a token representing it on the blockchain, in a process called "tokenization." The token now represents ownership in the underlying asset, allowing investors to buy and sell it onchain.
The RWA space has skyrocketed in value in recent years, growing from $100 million in 2021 to over $60 billion today. This represents a fundamental shift in the makeup of crypto market participants, with a growing number of major financial institutions bringing their assets onchain. In December 2025, BlackRock CEO Larry Fink predicted that all markets will eventually move towards tokenization, increasing the liquidity and accessibility of legacy assets.
In this article, we’ll be looking at the major RWA classes driving this growth, and how tokenization is improving legacy markets.
What are the different classes of RWA?
Real-world assets fit into a wide range of categories. Some are well-established, with billions in tokenized value, while others are more nascent and experimental. Some of the most significant include:
- Stablecoins: Tokenized fiat currencies qualify as RWAs, making dollar-backed stablecoins the largest category at over $300 billion.
- US Treasury Debt: Major asset managers including BlackRock and Franklin Templeton have launched US treasury funds onchain.
- Commodities: Tokenized gold comprises the bulk of this category, led by Tether Gold, although gemstones, energy, agriculture and other precious metals are also represented.
- Private Credit: Loan portfolios issued by non-bank lenders are increasingly being brought onchain.
- Stocks: Several major firms, including Ondo Finance and Backed Finance (xStocks), specialize in tokenizing US equities.
- Private Equity: Shares in privately held companies can be tokenized and traded onchain, increasing the liquidity and accessibility of these markets.
- Real Estate: These tokens represent fractional ownership of homes, offices and commercial properties around the world (a small but fast-growing category).
Many other categories of RWAs exist — such as tokenized collectibles, fine art, whiskeys and intellectual property — although these are generally far more experimental and small-scale.
How are RWAs issued?
RWA issuance is more complex than the creation of entirely blockchain-based assets: additional regulatory and custodial considerations come into play. This requires collaboration between offchain and onchain infrastructure providers. In practice, the process typically looks something like this:
- An asset manager acquires the base asset and transfers it into a special purpose vehicle or fund structure.
- A regulated custodian safeguards the assets.
- A tokenization platform issues blockchain tokens tied to the assets.
Established tokenization pipelines work most effectively for assets like equities, corporate debt and money market funds. These paper-based assets are easier to tokenize than the likes of real estate or oil: physical assets with their own distinct regulations and custody challenges.
That’s why the fastest-growing RWA categories are those without cumbersome storage demands or an excess of regulatory red tape.
Who are the major tokenization firms?
The list of the largest RWA issuers includes major asset managers from both traditional finance and Web3. For example, the largest onchain US treasuries funds are issued by Circle (also the issuer of the stablecoin USDC), BlackRock (BUIDL) and Franklin Templeton (BENJI). Traditional finance is increasingly embracing tokenization as a way to bring down costs and increase the efficiency of legacy markets.
The largest tokenization-as-a-service provider is Securitize. This firm also builds tokenized trading and settlement rails for governments and institutions in the US and Europe. In March 2026, Securitize was commissioned by the New York Stock Exchange to create a 24/7 tokenized equities trading platform.
Ethereum is the blockchain capturing the majority of RWA volume, with over half of all tokenized assets residing there. BNB Chain and Solana fill out the other top spots, although their individual volume is still just a fraction of Ethereum’s.
What are the benefits of RWA tokenization?
Tokenization can increase the efficiency and accessibility of legacy markets. Some of the major upsides cited by financial institutions include:
- 24-hour trading: The crypto markets are always on, meaning traders can capitalize on opportunities even when traditional markets are closed on evenings and weekends.
- Instant settlement: Traditional markets often operate on a T+1 settlement time — on the blockchain, exchanges of value can settle in milliseconds rather than days.
- Cost efficiency: Migrating markets to blockchain rails eliminates intermediaries such as clearing houses and transfer agents, meaning their fees are also eliminated.
- Fractionalization: Tokenization allows for assets to be broken down into smaller units, meaning expensive and/or illiquid assets can be traded in cheaper fractions.
- Accessibility: Bringing legacy assets onchain can open up markets to entirely new groups of investors around the world.
BlackRock CEO Larry Fink recently predicted that tokenization will make investing — even in traditionally inaccessible alternative assets — as simple as online shopping. He said assets will become “easier to issue, easier to trade, and easier to access."
Are there any risks with investing in RWAs?
Real-world assets inherit the associated risks of their underlying assets, which will vary depending on the specific asset class. Over and above this, tokenization introduces some additional points to consider:
- Custodial risk: The assets backing the onchain RWAs must be held with a custodian (the entity that safeguards the assets). If a custodian were to go bankrupt or mismanage assets, this could compromise investors’ holdings.
- Regulatory uncertainty: Although regulatory structures surrounding tokenized assets are maturing fast in many places, these developments are still very new (and therefore subject to potential revision). In addition, some jurisdictions may not recognize the legality of tokenized asset ownership at all.
- Smart contract risk: As with any blockchain-based asset, code exploits could lead to a loss of user funds.
- Liquidity problems: Although tokenization can improve the liquidity of markets, some RWA markets remain nascent and immature. Illiquidity may still be an issue when trading tokens in more niche sectors.
© 2026 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.