RWA Dominates! Tokenized US Treasury Yield Surpasses DeFi, Total Market Value Exceeds $600 Million

Given the downturn in the 2022 market, the DeFi ecosystem has lagged behind traditional financial TradeFi, leading to a surge in the discussion of tokenizing financial and real-world assets, known as tokenized assets RWA, which is now being hailed as a "killer application" for bringing crypto technology into the real world and future development. Similarly, the market value of tokenized US Treasury bonds has surpassed 600 million US dollars today.

Crypto Investors Flock to Tokenized U.S. Treasuries in First Half of the Year

The world asset tokenization analysis platform RWA.xyz released a research report yesterday, revealing a significant increase in demand from crypto investors for tokenized U.S. treasuries this year. Due to the perception of U.S. treasuries as risk-free with substantially higher yields compared to most DeFi protocols, the total market value has surpassed $617 million.

The report indicates that tokenized U.S. treasuries currently offer varying floating yields of up to 4.24%, significantly higher than the average APR of around 2% on DeFi protocols. Among them, investment giant Franklin Templeton with their Franklin OnChain U.S. Government Money Fund is currently the first and largest investment product.

During the downturn in the crypto market last year, DeFi yields plummeted, while traditional finance (TradFi) bond yields rose to their highest levels since 2007 due to the Federal Reserve's response to the inflation crisis.

It was also discovered that some investors in the crypto ecosystem are gradually shifting funds from crypto assets to U.S. treasuries due to changes in the macroeconomic landscape.

Asset management company Bernstein claims that the RWA market could reach a market value of $50 trillion in the next five years. The detailed report further explores and compares the details and differences among various tokenized asset companies, which can be found here.

For more information on RWA, please visit: Real-world asset RWA - Building a Friendly Bridge between Traditional Finance and DeFi

The Pace of Tokenized Assets May Be Slower Than Expected

Additionally, according to data from Dune Analytics showing, the total market value of tokenized securities, including bonds and investment bond ETFs, has grown from $220 million reported on May 23 to the current $270 million, a growth rate similar to that of tokenized U.S. treasuries. While there may be discrepancies in various statistics, a stable growth trend is evident.

However, asset management giant BlackRock previously stated at a crypto summit hosted by Coinbase that:

Tokenization of stocks, bonds, and other traditional assets will occur, but the progress is expected to be slower than people anticipate due to the implementation of real-name authentication KYC and anti-money laundering AML measures.