Binance Report Highlights $12 Billion Growth in RWA Tokenization

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Hongji Feng

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Hongji Feng

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Hongji is a crypto and tech reporter. He graduated from Northwestern University's Medill School of Journalism with a Bachelor's and a Master's. He has previously interned at HTX (Huobi Global),...

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September 13, 2024 12:10 EDT

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According to a September 2024 report by Binance Research, the market value of tokenized real-world assets (RWAs) has exceeded $12 billion, primarily driven by the tokenization of U.S. Treasuries.

The report emphasized the expansion of tokenized assets such as government bonds, private credit, and real estate, highlighting traditional financial institutions’ growing involvement in blockchain.

RWA Market Growth Driven by Treasuries

The RWA market encompasses a range of tokenized assets, such as U.S. Treasuries, private credit, commodities, stocks, real estate, and non-U.S. bonds.

Additionally, newer categories like air rights, carbon credits, and fine art are starting to emerge within the space, offering more investment opportunities.

The report indicated that the growing appeal of tokenized U.S. Treasuries, which have reached over $2.2 billion in market value, is substantially driven by elevated interest rates in the U.S., making these digital representations of government debt an attractive option for investors.

Established Financial Institutions and Tokenization

The growth of the RWA market has been heavily influenced by the participation of established financial entities, according to the report.

Financial institutions like BlackRock and Franklin Templeton have adopted tokenized assets, with BlackRock’s Treasury product valued at over $500 million currently leading the market.

Franklin Templeton’s FBOXX product is also a major player in this sector, reinforcing the trend of traditional finance entering the tokenization market.

Other companies, such as WisdomTree, have added tokenized equities and digital funds to their portfolios, indicating a broader shift among financial firms toward new digital asset classes.

“From a macroeconomic perspective, we are set to commence on a historic rate-cutting cycle in the U.S., which might have consequences for many RWA protocols, particularly those focused on tokenized U.S. Treasuries,” the report stated.

Binance Research also cautioned against potential regulations, saying, “The concern around the legal landscape surrounding RWAs also remains.”