Real-world asset (RWA) tokenization is a rising use case of blockchain technology, influencing both traditional finance (TradFi) and its decentralized counterpart — DeFi. Tokenizing traditional assets can unlock undiscovered business potential, enhance liquidity and accessibility and serve as the nexus between the two iterations of finance.
According to industry trackers, the total value of tokenized real-world assets surpassed $15.2 billion at the end of 2024 (excluding stablecoins). The practice is increasingly adopted by institutional players, with established financial entities piloting tokenization projects for real estate, commodities like gold and diamonds, and even carbon credits.
BlackRock, a giant fund manager, is seeking regulatory approval to tokenize bonds and stocks, while JPMorgan has launched an in-house tokenization platform and is actively exploring RWA opportunities. Rising interest signals further market growth, and the space is projected to cross the trillion mark over the next five years.
Total value of tokenized real-world assets. Source: InvestaX
The year 2025 stands as a turning point. As tokenization gains momentum, the market is poised for regulatory maturity and more widespread interoperability — opening the door to unprecedented user adoption.
Below are five key trends that can shape tokenized RWAs and elevate the industry in 2025.
Regulatory alignment
Regulatory frameworks for tokenized RWAs are gradually taking form around the world. The UAE stands out with clarified regulations regarding RWAs, while Singapore, Europe and Hong Kong are working to achieve the same. Ongoing efforts to align fragmented regulations may result in a global framework and support interoperable protocols, which would foster adoption.
Regulatory maturity also depends on technical considerations. Blockchain is decentralized and permissionless by nature —great for DeFi, but potentially challenging for TradFi players who need some level of control and guaranteed compliance.
Mantra, a layer-1 blockchain built for RWAs, allows ecosystem participants to build permissioned applications within a permissionless environment. This dual model enables regulators to maintain oversight while letting developers, institutions and retail users tap into DeFi. Platforms employing this approach will be uniquely positioned to meet global compliance requirements without stifling innovation.
Mantra recently obtained a virtual asset service provider (VASP) license from Dubai’s Virtual Assets Regulatory Authority (VARA), making it the first DeFi platform to do so. The license will allow Mantra to provide exchange, broker-dealer and management and investment services in the region.
The rise of multichain economies
One of the most important benefits of tokenization — especially for TradFi — is liquidity. Bringing previously illiquid assets onto blockchain creates new, more accessible markets.
Yet, to unlock tokenization’s full potential, blockchains must enable asset transfers between them, a capability not inherently present in the technology. This is where interoperable solutions step in.
The blockchain interoperability market has shown an exponential rise to nearly a 30% year-on-year growth, and this trend will likely prevail in 2025. The growth of multichain ecosystems is making it simpler to transfer tokens across various blockchains. Interoperability can drive mainstream adoption by creating seamless user experiences, reducing transaction costs and broadening the potential investor base.
Blockchain interoperability market size. Source: The Business Research Company
Mantra Chain can interoperate with other chains thanks to its integration with Inter-Blockchain Communication (IBC) protocol, which facilitates communication between blockchains. The IBC compatibility ensures tokenized RWAs can interact with multiple networks — spurring liquidity and opening new markets.
Fractional ownership of high-value assets
Investing in traditionally exclusive markets like art, luxury collectibles and real estate was once only possible with significant capital, thereby limiting access to institutions and high-net-worth individuals.
However, with tokenization, high-value assets can be divided into smaller denominations, allowing investors to own and trade fractional tokens rather than entire assets. Fractional ownership reduces the entry cost for investors, enables a broader range of people to participate in relevant markets and democratizes these markets.
Mantra Chain allows ecosystem participants to develop and make use of fractional RWAs. A recent partnership with Damac, a prominent real estate developer with a diverse portfolio, aims to tokenize at least $1 billion worth of assets from its portfolio, making these assets available for investing through fractional ownership.
Growth of digital identity solutions
Tokenized RWAs are digital representations of real-world properties, and they serve as certificates of ownership. Consequently, trading in a regulatory-compliant manner requires efficient identification of market participants on blockchain networks.
The demand for robust digital identity (DID) solutions, coupled with stringent Know-Your-Customer (KYC) requirements, is increasing. Such solutions can verify user credentials and ensure only compliant wallets are authorized to interact with certain tokenized assets.
Mantra has developed a DID module that integrates KYC checks — conducted by authorized entities — directly into the users’ wallets. This module could serve as a model for digital identification, simplifying cross-border compliance and boosting market confidence.
Liquidity innovations with DEXs
Unlocking liquidity remains the main promise of tokenized RWAs. Decentralized exchanges (DEXs), where onchain assets are frequently traded, are pivotal for liquidity.
Contrary to traditional exchanges, DEXs can operate 24/7 and are easily accessible with just an internet connection. This opens up continuous trading opportunities without relying on centralized intermediaries.
Mantra is currently developing a protocol to further improve liquidity conditions for its in-house DEX named LEEP, short for Liquidity Efficient Emissions Protocol. This platform aims to tackle liquidity scarcity by incentivizing robust markets for less-traded assets.
2025 and beyond
RWA tokenization is moving from experimentation to real-world impact. The industry is set to mature in 2025, driven by regulatory clarity, interoperability, fractional ownership, digital identity and liquidity solutions. The coming years will test its ability to grow, integrate with traditional markets and deliver tangible benefits.
Collaboration between institutions, regulators, and blockchain innovators will be key to scaling this transformation. If key players build the right infrastructure and prepare favorable legal frameworks, tokenized assets can serve as a solid bridge between TradFi and DeFi and redefine capital markets, making finance more efficient, accessible and globally connected.
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