Author: Sandy Kaul
Compiled by: Jiahuan, ChainCatcher
As regulatory clarity increases, trust in underlying crypto technologies continues to grow. The trend of using blockchain tokens to represent investable assets is accelerating.
These tokenized assets include: stocks, bonds, funds, ETFs, commodities, private equity, private credit, real estate, and other types of private funds. The industry commonly refers to these collectively as "real-world assets," or RWA.
This name is used to distinguish it from native cryptocurrencies or altcoins, which invest in projects and protocols within the crypto ecosystem rather than real-world assets.
Early 2026 data shows that RWA tokenization is experiencing explosive growth, estimated to have increased fivefold since 2023 and tripled between 2025 and 2026 alone. (1)
Starting from approximately $5 billion in 2023, on-chain value has now surpassed $25 billion, with private credit, treasury products, and real estate accounting for the majority. (2)
Growth is still accelerating. Projections suggest that by the 2030s, the total value of tokenized RWA could reach as high as $4 to $16 trillion, with some forecasts predicting it will surpass $30 trillion by 2033. (3)
Regardless of the specific numbers, intensive announcements from key industry participants regarding tokenization plans have provided strong support for these projections.
Pioneers break through
Tokenization of real-world assets is not new. Franklin Templeton launched the first tokenized money market fund in April 2021, which has been running 24/7 ever since, with a total value of nearly $1.5 billion on the Benji technology platform.
The true turning point that captured market attention was the extension of tokenization from government bonds and money market funds to equities. Early adopters ignited this momentum, accelerating the entire RWA tokenization process.
Robinhood announced in June 2025 that it would offer over 200 tokenized U.S. stocks to EU customers. Its CEO, Vlad Tenev, said: "Tokenization is like a freight train that cannot be stopped and will eventually consume the entire financial system."(4)
The cryptocurrency exchange Kraken followed suit, launching xStocks on Ethereum and Solana in June of the same year for investors outside the U.S., U.K., and other restricted regions. In the nine months that followed, xStocks recorded $3.6 billion in on-chain trading volume and approximately $25 billion in total trading volume, with nearly 80,000 wallets holding around $225 million in tokenized assets. (5)
Ondo Global Markets launched over 200 tokenized stocks in September 2025. In the six months prior to platform launch, the total value exceeded $5 billion, with cumulative trading volume surpassing $7 billion. Combined with over $2 billion locked in Ondo Finance’s tokenized U.S. Treasury products, its total scale continues to lead the market. (6)
Traditional U.S. institutions enter the market
The actions of emerging platforms have already grabbed attention. But what truly made the entire industry realize that "a new era has arrived" was the series of announcements released by top traditional institutions afterward.
The changes signaled by these announcements represent the most significant upgrade to the way securities have been operated since the introduction of book-entry systems in the early 1970s.
DTCC received a no-action letter from the SEC in December 2025, paving the way for it to offer DTC custody of tokenized RWA assets starting in the second half of 2026. (7)
The NYSE announced the development of a tokenized securities trading and on-chain settlement platform supporting 7×24-hour operations, instant settlement, USD-denominated orders, and stablecoin funding. (8)
Nasdaq has partnered with Kraken's parent company to introduce equity tokenization for publicly traded companies, enabling automated corporate actions such as programmable investor engagement, proxy voting, and dividend payments, with an expected launch in early 2027. (9)
Three tokenization pathways
The hype around tokenization continues to rise, but to truly understand how it will transform finance, several concepts need to be clarified. Over the coming months, three types of tokenized products may emerge in the market:
Digital-native tokenized products
Directly hold the underlying assets (stocks, bonds, commodities, or funds). Token holders enjoy full ownership and associated protections, with ownership records maintained solely on a single on-chain ledger, without any off-chain records.
After verification, funds and assets are immediately settled atomically. Franklin Templeton’s tokenized money market fund is an example of this.
Synthetic asset tokens
It is a digital-native product that does not directly hold the underlying asset; instead, it functions more like a swap arrangement that transfers the economic returns of the underlying asset to the holder.
Token holders actually own shares in a special purpose vehicle (SPV) that holds the underlying assets. These products are also known as "wrapped" or "asset-backed" investments. Upon transaction verification, payment and token exchange occur simultaneously. Tokenized stocks from Robinhood, Kraken, and Ondo fall into this category.
Digital Mirror Tokens
Does not directly hold the reference asset. Ownership of the asset is recorded in traditional off-chain forms (such as limited partnership interests), and the token serves only as a "receipt" proving the holder's ownership of the off-chain asset.
These products require two ledgers: an off-chain legacy system that records actual ownership (typically updated via overnight batch processing) and an on-chain ledger that separately tracks tokens. Tokens are minted only after positions are established and verified off-chain, and are immediately burned when positions are closed. They are subject to traditional T+1 or longer settlement cycles. Plans by DTCC, NYSE, and NASDAQ to issue such products fall into this category.
Permissionless vs. Permissioned Tokens
All three models require the transfer agent to implement a new compliance process—“Know Your Token” (KYT). This process reviews the wallet addresses involved in token purchases and sales and tracks recent token movement history. The blockchain itself supports this review through whitelist authentication, confirming that the wallet is not on any restricted list and that the holder has completed eligibility verification.
Synthetic asset tokens require no additional verification beyond KYT and are therefore permissionless tokens. As long as the wallet passes KYT verification and meets the holding criteria, transactions can proceed directly.
Digital-native products and digital mirror tokens are licensed tokens. In addition to KYT, holders must complete a full KYC/AML (Know Your Customer/Anti-Money Laundering) review.
The utility differences among the three models
Synthetic asset tokens have the broadest utility in the crypto ecosystem but offer the weakest protection of investor rights.
These tokens can be freely transferred between any wallet that complies with KYT requirements, can be used as assets or collateral in DeFi protocols, and allow holders to access liquidity 24/7, with opportunities to earn additional rewards.
However, the cost is that holders have no voting rights, economic returns (yield, dividends) are indirectly passed through rather than paid directly, and in most cases, they have no claim against the issuer of the underlying asset.
Digital-native RWA tokens have secondary utility but face more restrictions. Tokens can be transferred between wallets, but only between wallets that have simultaneously passed KYT and KYC/AML verification. Holders are the official owners of the RWA and enjoy full voting rights and direct economic benefits.
These tokens are difficult to use in DeFi—tokens staked with protocols are pooled together and cannot be traced to specific wallets. However, they are highly efficient as collateral for financing arrangements and derivative trading.
Because ownership records are updated second by second on the chain, advantages impossible in traditional models are achieved. For example, with Franklin Templeton’s tokenized money market fund: investors begin earning interest the instant they enter a position, and returns are delivered directly to their wallets as incremental new tokens daily—something the digital mirror model cannot do.
Digital mirror tokens have the lowest utility among the three models. Rights and benefits are managed by off-chain legacy systems, with distributions made via fiat into traditional investment accounts and paid out on a fixed schedule (e.g., monthly returns like money market funds). The tokens are tied to specific off-chain holdings, cannot be transferred between wallets, and are minted upon subscription and burned upon redemption.
Even so, digital mirror tokens retain value: they exist directly in investors’ wallets rather than as ledger entries in intermediary databases, offering greater transparency. The tokenized format also enables 24/7 trading, as on-chain token records can be updated in real time, even if off-chain ownership records experience delays.
Moving in the right direction
Compared to the traditional methods that have dominated securities and fund processing over the past 50 years, each of the three RWA tokenization models offers unique advantages and novel utilities.
All pathways are built on the latest blockchain technology, with tokens serving as "smart" wrappers that embed and automatically execute operational workflows. Each model enhances holding transparency, making assets more usable as collateral, and some even create entirely new yield opportunities.
Most importantly, RWA tokenization is driving both crypto-native institutions and traditional financial participants toward a shared infrastructure.
Wallets will become the core financial interface for individuals and institutions. And today’s wave of RWA tokenization is the bridge to that future.
Source
Coindesk, "The RWA tokenization market has grown nearly fivefold in three years to $24 billion," June 26, 2025
Brikken, "Real-World Asset Tokenization in 2025: Market Leaders, Asset Trends, and Future Outlook," 2025
Same as above
CNBC, "Asset tokenization is a freight train heading toward the market: Robinhood CEO", October 2, 2025
Trading View News, "Kraken launches xChange engine to power tokenized stock trading"
Ondo Finance, "Ondo becomes the largest provider of tokenized Treasury bonds and stocks, with total locked value exceeding $2.5 billion"
DTTC, paving the way for asset tokenization held by DTC
Intercontinental Exchange, "developing a tokenized securities platform for the New York Stock Exchange"
Nasdaq, "Nasdaq introduces equity token design, placing issuers at the heart of tokenization"