Real-world Asset Tokenization: Use Cases And Fields!

Hello, everybody! At Info-Polus, we see the opportunities RWA tokenization presents. So this is the second part of our dive into the future of DeFi! Today, let’s speak about Current Use Cases and Industries!

The real world assets market is not yet fully formed, but it has already been divided into categories of projects that belong to the general trend of tokenized real-world assets.

• Centralized Stablecoins: Popular coins such as USDT from Tether or USDC from Circle are inherently RWAs. Token issuers lock fiat currencies and government or commercial securities in their accounts as collateral. They then issue stablecoins, which is a tokenization.
• Private Lending: MakerDAO, the DAI stablecoin issuer, is one player in this field. In mid-2022, the company opened a $100 million tokenized credit line for the American Huntingdon Valley Bank and promised off-balance sheet loans as security.
• Government Bonds: The sector is represented by companies issuing stablecoins secured by treasury bonds of any country.
• Tokenized Securities: The crypto exchange Bitfinex was the innovator in this sector. In September 2021, its subsidiary platform Bitfinex Securities, focused on the RWA market, began operations. In October 2023, it issued its first tokenized bond with a 3-year maturity period and a 10% rate.
• Institutional Investors: Yes, they have also shown interest in the sector. The biggest bank in the United Kingdom, HSBC, intended to provide a service allowing clients to own tokenized assets by the end of 2024. Additionally involved in the development were financial behemoths BlackRock and Barclays.
• Real Estate: Tokenizing property ownership enables fractional ownership, hence improving smaller investors' access to the real estate market.
• Carbon Credit Certificates: The market for green certificates gained popularity in 2022. However, this is a very underdeveloped market at the moment. So we can only imagine the possibilities here.
• Works of Art and Collectibles: The NFT market helps to depict this section. Several businesses and investors once tokenized artworks of well-known painters, therefore adding value to blockchain in 2021.
• Precious Metals: Participants in this area of the RWA market are issuers of stablecoins that have precious metals in physical form as collateral. Examples include tokens from Paxos or XAUT from Tether.

P.S. I’ve missed one field here; can you name it? And if you're interested in our full article, check it out here.