Research Summary
The report discusses the significant growth in the value of real-world assets (RWAs) locked in decentralized finance (DeFi) in 2023, driven by changing macroeconomic conditions and demand for off-chain yield. It highlights the performance of different types of RWAs, including Treasuries, real estate, and private credit, and the role of key RWA issuers such as Centrifuge, Franklin Templeton, and Wisdom Tree.
Key Takeaways
Growth of Tokenized Real-World Assets
- Surge in Value: The total value of RWAs locked in DeFi nearly doubled in 2023, growing from $1.44 billion to $2.5 billion as of September 30, 2023. This growth was driven by changing macroeconomic conditions, including rising interest rates and a bear market in cryptoassets.
- Yield-Bearing RWAs: Demand for off-chain yield has fueled the growth of RWAs on-chain, with the market share of yield-bearing RWAs increasing from 31% to 53% from January 1 to September 30.
- Non-Stablecoin RWAs: Non-stablecoin RWAs have grown in value by $1.05 billion in 2023, with $855.7 million coming from Treasuries, real estate, and private credit.
- Market Cap of RWAs: Despite strong growth, the market cap of tokenized RWAs is still 9.6% below the all-time high achieved in Spring 2022.
Performance of Different Types of RWAs
- Private Credit Loans: The value of active on-chain private credit loans has expanded by $210.5 million (84%) from January 1 to September 30.
- Real Estate: On-chain real estate has grown by $90 million (102% growth) over the same period.
- Treasuries and Other Bonds: Treasuries and other bonds have grown by $557 million in value.
Role of Key RWA Issuers
- Centrifuge, Franklin Templeton, and Wisdom Tree: These issuers have played a significant role in the creation and distribution of RWA tokens to on-chain users.
- Tangible: Tangible, a real estate-focused RWA issuer, has shown the strongest growth, with the total value locked in its tokens growing from $100,000 to $64 million over the first three quarters of 2023.
- Ondo Finance, Franklin Templeton, and Matrixdock: These issuers have contributed to the growth in value of tokenized Treasuries and other bonds by $557.05 million from January 1 to September 30.
Actionable Insights
- Future Growth Potential: The growth of RWAs onchain is primarily driven by demand from native crypto users, indicating the potential for this sector of DeFi to attract new users in the future.
- Early Signs of Adoption: Major traditional financial companies like Franklin Templeton and Wisdom Tree have shown early signs of adoption for RWAs, further illustrating the potential for growth in this sector.
- Impact of Macroeconomic Environment: The evolving macro environment and continued demand from both native and non-native crypto users will influence the future evolution of the RWA sector.
