The RWA (Real World Assets) sector is heating up: Tether and Visa are competing to establish a presence, while BlackRock's CEO and a16z are both optimistic about the future of tokenization.

Recently, with Trump's victory in the U.S. elections, the crypto market's popularity has surged, and the RWA sector has frequently welcomed new developments. For example, on November 14, Tether announced the launch of its asset tokenization platform, Hadron by Tether, while Visa also released its tokenized asset issuance and management platform, Visa Tokenized Asset Platform (VTAP), in early October.

In the context of increasingly clear regulatory policies, optimism about the future of tokenization within the industry is also on the rise. Jesse Knutson, head of operations at Bitfinex Securities, recently pointed out that large financial institutions will become the main driving force behind the growth of the tokenization industry. Moreover, BlackRock CEO Larry Fink views the tokenization of financial assets as the "next step in future development."

The core idea of RWA tokenization is to mint financial assets and other tangible assets onto an immutable blockchain ledger, thereby enhancing investor accessibility, improving liquidity for these assets, creating more trading opportunities, while saving on transaction costs and increasing security.

According to data from rwa.xyz, as of November 18, the top 5 issuers by total value in the RWA sector (excluding stablecoins) are BlackRock ($542 million), Paxos ($506 million), Tether ($501 million), Ondo ($452 million), and Franklin Templeton ($410 million).

The RWA sector is heating up alongside the overall rise of the crypto market. On November 14, Tether, the issuer of the stablecoin $USDT, announced the launch of its asset tokenization platform, Hadron by Tether, which simplifies the process of converting various assets into digital tokens. The platform allows users to easily tokenize stocks, bonds, commodities, funds, and loyalty points. According to official information, Hadron aims to open up new opportunities for individuals, companies, and even network nations to raise funds using tokenized collateral. Hadron not only provides risk control, asset issuance and destruction, KYC and anti-money laundering compliance guidance but also supports blockchain reporting and capital market management.

Technically, Hadron supports Ethereum, Avalanche, and Blockstream's Bitcoin scaling network Liquid, and will soon add the TON network and other smart contract chains.

Meanwhile, traditional financial giants are also keeping pace. On October 3, Visa launched the Visa Tokenized Asset Platform (VTAP), aiming to simplify the issuance and management of tokenized assets, including tokenized deposits, stablecoins, and central bank digital currencies (CBDCs). Through VTAP, financial institutions can leverage the sandbox environment provided by Visa's developer platform to create and test their own fiat-backed tokens.

While providing support for institutions, some projects are also beginning to focus on the potential of the retail market. On October 8, the EU tokenization protocol Midas opened its mTBILL and mBASIS tokens to retail traders. It is reported that the tokenization company has received regulatory approval from the Liechtenstein Financial Market Authority to open these funds to retail traders, making Midas's real-world asset (RWA) tokens the only regulated crypto tool in Europe without a minimum investment limit of $100,000.

On the other hand, tokenization of specific asset types is also attracting the attention of professional investors. At the end of October, the tokenized fund platform Elmnts, supported by oil and gas royalties, announced on X that it had launched a public beta on Solana. Elmnts is a compliant investment fund tokenization platform. These funds are supported by revenue generated from companies that extract oil and gas from land owned by the fund. The platform currently primarily targets institutions and high-net-worth individuals.

Additionally, participants in the DeFi space are also exploring more innovative paths through collaboration with traditional financial giants. Earlier this year, the DeFi protocol Ondo began utilizing BlackRock's USD Institutional Digital Liquidity Fund (BUIDL) to tokenize money market funds to develop its derivatives.

Global consulting firm Boston Consulting Group (BCG) referred to RWA tokenization as the "third revolution in asset management" in a paper published on October 29. Some believe that ETFs are the core of asset management 2.0, while tokenization may represent the era of asset management 3.0. Boston Consulting forecasts that within just seven years, the managed assets of tokenized funds could reach 1% of the global mutual and ETF managed assets, which means that by 2030, managed assets could exceed $600 billion; this trend is expected to continue, especially when regulated on-chain currencies (such as regulated stablecoins, tokenized deposits, and CBDC) projects are realized.

Moreover, according to a forecast by Tren Finance in their October report, the scale of the real-world asset (RWA) tokenization industry could exceed $30 trillion by 2030, with growth expected to exceed 50 times. Its rapid development is driven not only by agile financial institutions and mainstream financial entities but also supported by advancements in blockchain technology and progressively clearer regulations.

Against the backdrop of the continued rise of the crypto market, increased regulatory clarity has injected new confidence into the industry.

The venture capital firm a16z Crypto noted in a recent post on its official website directed at crypto founders: "The good news is that there is now a pathway for constructive engagement with regulators and legislators, which can bring regulatory clarity, and you should all feel empowered to explore all groundbreaking products and services supported by blockchain, including tokens."

The post specifically pointed out that token issuance is an activity that founders can now engage in with more confidence: "For many of you, the fear of overregulation has held you back from using tokens to allocate project control and build communities. Now, you should feel more confident about using tokens as legitimate and compliant tools for your projects."

Meanwhile, Jesse Knutson, Head of Operations at Bitfinex Securities, stated that large financial institutions will be a major driving force behind the significant growth of the tokenization industry. Knutson noted that institutions have already been pushing for significant growth in the crypto industry, and this impact may further extend to the tokenization field.

The positive expectations for RWA tokenization have also received responses from more professionals. Larry Fink, CEO of BlackRock, the world's largest asset management company, recently stated, "Tokenization of financial assets will be the next step in future development." He pointed out that in the future, every stock and bond will have a unique identification code (similar to CUSIP), and all transactions will be recorded on a unified ledger, with investors receiving exclusive identification. Fink stated that tokenization can effectively prevent illegal activities, and more importantly, it enables instant settlement, significantly reducing the settlement costs of stocks and bonds. In addition, tokenization will also bring the possibility of personalized investment strategies and improve corporate governance efficiency, ensuring that every shareholder can exercise their voting rights in a timely and accurate manner. Tokenizing real-world assets like real estate, commodities, wine, or art means creating blockchain tokens that represent ownership, making it easier to trade these traditionally hard-to-sell assets.

Specifically, according to a paper from State Street Global Advisors, bonds are expected to lead the large-scale adoption of tokenized real-world assets due to their structural characteristics. The report stated that the bond market has matured, making it suitable for tokenization; the complexity of these instruments, the repetitiveness of issuance costs, and the intense competition among intermediaries support rapid adoption and provide space for significant impact; blockchain technology can play an important role in markets that prioritize transaction speed (such as repos and swaps).