RWA's could be the next massive narrative in Crypto, BCG stated that tokenization of real-world assets is projected to hit $16T by 2030 and Coinbase report says tokenized assets could be a catalyst for an explosive DeFI growth 👀

What are RWAs?

RWA stands for "Real World Assets." This term is typically used to describe physical or traditional financial assets that have been tokenized on a blockchain!

Tokenization is a process where the rights to an asset are converted into a digital token on a blockchain. Real world assets that can be tokenized include things like real estate, intellectual property, shares in a company, bonds, commodities, etc

The concept of RWAs in crypto has gained attention with the rise of Decentralized Finance (DeFi), as tokenizing these assets allows them to be integrated into DeFi protocols and used in various ways, such as for lending and borrowing, earning yield, or as collateral for loans.

The Biggest Companies on earth are already adopting tokenization: Google, Visa, MasterCard, American Express,..

CEO of $10 Trillion Dollar asset manager, BlackRock said that “the tokenization of real-world assets is an attractive use case because it points to chances of driving efficiencies in capital markets, shortening value chains, and improving cost & access for investors.”

However, the integration of RWAs in DeFi platforms comes with various challenges, such as the need to ensure that the token accurately represents the underlying asset, dealing with legal and regulatory compliance, and managing the risk of real-world events that could affect the value of the asset.

Web 2.0 Real Estate Crowdfunding vs Web 3.0 Real world assets

Real Estate Crowdfunding gained a lot of popularity in the recent years, it enables individuals to pool their money together to invest in Real Estate projects using web platforms! It allows users lower barrier to entry real estate markets, access to better deals, geographic diversification & true passive income!

Global Real Estate Crowfunding market was valued at $10.78B in 2021, and expected to reach $124,55B by 2028 with CAGR of 41.8% over the period!

RWAs can be seen as WEB3 Version of Real Estate Crowdfunding (It has lots of other potentials with other assets, but lets focus on real estate)

RWAs use DeFi, which brings security, transparency and efficiency to the process by utilizing smart contracts!

By tokenizing assets, it enables fractional ownership, better liquidity, and fast transferability of assets!

It offers much increased accessibility to the global marketplace as Real Estate Crowdfunding are typically tied to a specific countries or regions! RWAs also require significantly less documents as Real Estate crowdfunding, where you need complex legal process & KYC!

RWAs could be the next huge narrative in Crypto, but only few players will emerge as winners!