Observations and personal views from Nothing Research Partner BonnaZhu, the following content does not constitute any investment advice.

As a meaningful attempt, it is good, and the Conflux team has put in a lot of effort for this, but based on the current yield/risk/liquidity combination of this RWA product, it is quite difficult to scale on-chain:

- Fixed 8% annualized

- 3 months without liquidity

This has already discouraged most funds, and purchasing this product requires cross-chain transactions, which further reduces the incentive. There are many opportunities in the market that offer higher yields with instant liquidity, and if one simply aims to break even on 8%, buying Ethena Labs' sUSDe would be sufficient.

After all, these are not assets like U.S. Treasuries and U.S. stocks that inherently have excellent off-chain liquidity and strong consensus; to achieve good 'sales', the yield expectations must be sufficient, exceeding the on-chain native yield opportunities during the same period. Huma Finance and GAIB are two relatively good examples, as if you look at their PT yields on RateX and Pendle, they are basically 13-15%.

If the yields cannot be made very high, then at least the liquidity of the assets must be relatively good. However, for an underlying asset that fundamentally has little liquidity off-chain, this seems a bit too harsh; who would come up with this money?

But the reality is, if a certain underlying asset is very difficult to design a RWA structure that meets on-chain capital's preferences for yield/risk/liquidity, then that asset may not be suitable for on-chain at this stage; at least, it certainly will not be particularly welcomed.

Issuing RWA is somewhat like doing investment banking; although the compliance of product architecture is crucial, merely focusing on approval and implementation while neglecting the 'sales' aspect will ultimately lead to inefficiency.

In fact, investment banks are quite profitable

It relies on their meticulous consideration in product design

If a product does not make money and cannot be sold

Then it certainly will not be made.