The post Is The RWA DeFi Ecosystem An Underserved Market? appeared on BitcoinEthereumNews.com.

Real World Assets (RWA) are currently among the fastest-growing ecosystems within the larger Decentralized Finance (DeFi) market.  According to DeFi Llama metrics, there is over $4 billion in digital asset funds locked across RWA protocols such as Ondo Finance, Pendle and the Jellyverse ecosystem. This figure is up from $753 million in January 2023. But while the RWA ecosystem has witnessed remarkable growth over the past year, it is still one of the most underserved DeFi markets.  A recent report by Citi estimates that the total addressable RWA market is in the trillions of dollars, with notable investment areas such as non-financial corporate debt, real estate, private equity, and securities set to contribute a significant chunk of RWA portfolios by 2030. Source: Citi  It is also worth mentioning that RWAs have been around for quite a while in the form of stablecoins such as USDT and USDC, which are essentially a tokenized form of the U.S. dollar. More recently, we’ve also seen traditional fund managers like Franklin Templeton and Blackrock take a huge interest in other types of RWAs. Both companies are already offering access to tokenized U.S. treasuries, with the former enjoying a market cap of $352 million, while Blackrock’s RWA portfolio is at $427 million as of this writing. The Challenge in RWA Scaling and Adoption  Similar to other innovations in the DeFi sector, RWAs are yet to reach their potential due to fundamental, technical and regulatory challenges. This section will highlight some of the main reasons why RWAs remain underserved despite their value proposition.  Regulatory Clarity   Compliance is one of the main hurdles innovators and investors in the RWA market are currently experiencing. For example, in the U.S., the SEC has strict guidelines on what should be classified as a security.  The tokenization of real world assets…

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Filed under: News - @ June 14, 2024 1:14 am