In the last issue, we only discussed the meaning of RWA. This time, let's talk about the categories of RWA and how they operate!
Typical RWA assets include:
Real estate (such as tokenized commercial real estate)
Bonds & government bonds (such as tokenized U.S. Treasury products)
Commodities (gold, oil, etc.)
Equity (private equity, startup shares)
Accounts receivable (supply chain finance assets)
The operating process of RWA:
① Asset tokenization: Mapping real assets into on-chain tokens through smart contracts.
② Custody & compliance: Managed by regulated custodians to ensure asset security.
③ Trading & liquidity: Trading on DeFi protocols or compliant exchanges (such as Coinbase, Kraken).
For example, tokenized U.S. Treasury allows investors to purchase U.S. Treasuries through DeFi.
Why is there optimism about the RWA sector? Here are a few points:
① Singapore, Hong Kong, and the EU have launched RWA regulatory frameworks.
② The issuers of USDC and USDT are entering the RWA lending space.
③ Traditional DeFi yields are declining, while RWA can offer higher returns.
During the process of organizing this information, I happened to come across this image, so I borrowed it!
Of course, RWA also comes with certain risks, and I can think of four key risks here:
① Regulatory compliance, for example, whether the U.S. SEC considers it a security? Will there be KYC requirements?
② Custody risk, if the custodian goes bankrupt due to other circumstances, how will this be resolved?
③ Liquidity, will there be situations of insufficient liquidity leading to high slippage?
④ Hacking, will smart contracts have vulnerabilities leading to asset theft?
RWA is currently also full of challenges, primarily facing regulatory and technical challenges. In the long run, RWA is a key sector for various assets to land on blockchain technology.
The above are some of my personal views on RWA. Please point out any inaccuracies!
