Is the RWA boom an illusion? Why do tokenized assets worth $60 billion still face liquidity problems?

In the crypto industry of 2026, tokenization of RWA (Real World Assets, real-world assets) has almost become the most eye-catching narrative main line. From U.S. Treasuries to private credit, from gold to real estate, all kinds of assets in the traditional financial world are being moved onto the blockchain at an unprecedented pace. Banks and asset management institutions are rolling out strategies one after another; the size of tokenized assets has surpassed $60B, covering 12 asset classes and more than 7,000 products.

However, a set of data complicates this “boom” story. In its report 《The Real State of Tokenization in 2026》 jointly released by BeInCrypto Intelligence and RWA.xyz, among 1,289 tokenized assets with a value exceeding $100k, 910 assets had no on-chain transfers within a week, involving a total value of $32.9 billion. This means that more than half of tokenized assets are in a “sleeping” state.

Putting assets on-chain does not mean a market has formed. The RWA narrative is entering an entirely new phase—from “asset issuance” to “market building.” Whether this transition succeeds will determine the final fate of $100k—and even tens of trillions of dollars—worth of tokenized assets in the future.

RWA’s “Boom” and “Concentration”

A market size of $60B sounds staggering. But diving into the data reveals that the structure of this market is far more complex than the headline number suggests.

BeInCrypto’s report tracks more than 7,000 products across 12 asset categories. However, only 62 assets account for 88% of the market’s total value, and the top 5 products contribute nearly half of the market cap. This is a highly concentrated market—most valuations are propped up by a small group of leading products, while the vast majority of tokenized assets sit at the margins.

Even more notable is the distribution of activity levels. Among 1,289 tokenized assets priced over $100k, only 379 assets show weekly on-chain activity, representing an active value of $26.2 billion in total. The 910 “dormant” assets total $32.9 billion, accounting for 56% of the entire market.

BeInCrypto’s report divides assets into two categories: “distributed assets” and “representative assets.” Distributed assets can move freely on public blockchains and can be used between wallets, platforms, or DeFi protocols; representative assets, by contrast, more often use the blockchain as an internal ledger or a digital record of off-chain holdings. About $2.7 billion of the dormant value comes from representative assets. For these products, a low transfer rate does not necessarily mean failure—some assets are not designed for public secondary-market circulation in the first place.

But in any case, the data points clearly to a conclusion: tokenized finance has not yet formed a truly broad, mature market with liquidity. Even among active assets, trading and transfer activity remains highly concentrated in a very small number of products.

Liquidity Dilemma: Why $60B in Assets “Sleep”

The logic chain in traditional finance is clear: assets → market → liquidity. Assets are created, enter trading markets, and liquidity forms through buyers, sellers, and market makers. But the chain in today’s RWA looks like this: asset → token → stays on-chain.

This chain is missing a key link—buyers, market makers, and trading venues.

When commenting on this phenomenon, Theo’s Chief Investment Officer Iggy Ioppe said, “Pack an asset into a token and then idle it—that’s a ‘tokenization performance.’ Real work is making the token usable—as collateral, in DeFi, and for real-time settlement.”

The liquidity predicament in the current RWA market can be understood across several dimensions.

First, tokenization does not equal tradability. Putting assets on-chain is only the first step of digitizing representation. A token needs buyers willing to purchase, sellers willing to sell, and market makers providing depth—so that effective price discovery and a trading market can form. A large number of RWA tokens lack these elements.

Second, there is a lack of deep integration with the DeFi ecosystem. If tokenized assets cannot be used as collateral, cannot participate in lending and borrowing, and cannot generate yield strategies, then at their core they are merely “digital certificates” on-chain rather than active financial instruments. Out of the current approximately $100k RWA assets under management, only about $27B truly enter lending markets and are used as collateral. That means more than 90% of RWA assets have not generated meaningful interaction with the DeFi ecosystem.

Third, distribution channels are constrained. Whitelisting mechanisms, jurisdictional restrictions, custody arrangements, and fragmented compliance requirements hinder assets from freely moving between wallets and trading platforms. Even if a token exists, if only a small number of addresses can hold and trade it, liquidity cannot form.

From “Tokenization” to “Financialization”: Where RWA’s True Value Lies

Simply packaging assets into tokens does not constitute financial innovation. Experts generally agree that RWA’s true value comes from three directions.

As DeFi collateral. This is the clearest use case today. Tokenized U.S. Treasuries have already been introduced into lending protocols such as Aave and Morpho as collateral. Institutions holding Treasury tokens can borrow liquidity without selling their positions. In July 2026, Aave V4 launched on Avalanche, specifically supporting tokenized RWA borrowing; target assets include U.S. Treasuries, money market funds, private credit, and corporate bonds.

Real-time settlement. The T+1 or T+2 settlement cycles in traditional financial markets can be compressed into 24/7 instant settlement on-chain. This has tangible value for institutional capital turnover efficiency and risk management.

Cross-market asset portfolios. Gold tokens, dollar stablecoins, and on-chain funds can be combined in the same environment to form new asset allocation schemes that traditional finance finds hard to achieve. This composability is a unique advantage of blockchain infrastructure over traditional finance.

However, realizing these values depends on one prerequisite: the assets must be liquid, tradable, and usable. As OpenEden’s Strategic Director Stephanie Chew put it, what institutions care about is no longer whether tokenization “really exists,” but the more practical question: can assets be used within existing risk, custody, compliance, and trading architectures?

Blockchain Fragmentation: Structural Obstacles to Liquidity

One core problem institutions face when rolling out RWA is choosing which chain.

Current RWA assets are distributed across Ethereum, Solana, Polygon, Avalanche, and various institution-specific private chains. Each chain has its own liquidity pools, separate DeFi protocols, and separate pricing mechanisms. This fragmentation directly leads to a split in liquidity.

As of mid-July 2026, distributed RWA value on Ethereum is about $16.3 billion, on Solana about $3.32 billion, and on Avalanche about $2.1 billion. RWA assets cannot flow freely between chains, forming isolated pools of liquidity.

Archax CEO Graham Rodford was blunt about it: “The fragmentation issue is real, and it won’t disappear. Every important asset management firm is asking the same operational question: which chain should I choose? What happens when the next new chain appears? The honest answer is that they shouldn’t be forced to choose.”

Rodford believes institutions need a regulated layer independent of any single blockchain to handle issuance, trading, custody, and settlement. Public chains are not inherently unregulated—“what determines regulatory safety is not the chain itself, but the gateway.”

What RWA will need in the future is blockchain-agnostic infrastructure—one that isn’t tied to any single blockchain, can support cross-chain issuance, unified custody, compliant settlement, and aggregated liquidity. The absence of such infrastructure is precisely the structural bottleneck currently constraining RWA from “tokenization existing” to “a tokenized market.”

Regulation: New Competitive Barriers and Potential Regional Islands

Regulation is becoming the new competitive barrier in the RWA space. Different regions are forming their own rule sets.

The U.S. is taking a relatively strict regulatory approach, with the U.S. Securities and Exchange Commission broadly classifying many RWA tokens as having securities attributes. The EU’s MiCA (Markets in Crypto-Assets Regulation) has already fully taken effect, establishing unified rules across 27 countries. Hong Kong and Singapore use regulatory sandboxes and clearer rules to gradually position themselves as cross-border trading hubs.

This regulatory divergence may bring a potential risk: regional liquidity islands. Sygnum Bank’s Chief Information Officer Fabian Dori warned that as different jurisdictions set different rules and standards, the market risks being split into isolated liquidity pools. EU-regulated products account for only $3.3 billion of the core market so far, about 6% of the overall market.

Dori believes regulated platforms must connect cross-chain issuers and investors while still preserving local legal and compliance requirements. The focus of future competition is not who issues more tokens, but who can connect asset issuers, regulators, investors, and trading markets—building a compliant and interconnected ecosystem.

RWA’s Next Phase: From Tokenized Assets to a Tokenized Financial Market

In its research report, BeInCrypto concludes that the next stage of tokenization is not about launching more assets, but about building supporting systems that allow assets to be transferable, settleable, compliant, and accessible to investors. Without more完善 entry mechanisms, transfer controls, compliance processes, collateral use arrangements, and market depth, many tokenized assets will remain at the level of digital records and struggle to become usable financial instruments.

RWA development can be divided into three phases.

Phase 1: Asset digitization. Tokenize traditional assets through blockchain representation, completing the transformation from physical form to digital form. The core work in this phase is legal structure design, smart contract development, and asset onboarding to the chain.

Phase 2: Asset liquidization. Enable tokenized assets to be traded, transferred, and used. This requires the joint participation of market makers, trading platforms, lending protocols, and settlement systems. Current RWA is at a critical node transitioning from Phase 1 to Phase 2.

Phase 3: Asset financialization. Tokenized assets become an organic part of the on-chain financial system, able to serve as collateral, participate in yield strategies, enable cross-market portfolio composition, and deeply integrate with traditional finance and crypto finance.

The metric for RWA success should not be “how many assets exist on-chain,” but “how many assets are traded, collateralized, and used every day.”

Conclusion

A $60B tokenized RWA market is an important milestone, but it hides a deeper reality: putting assets on-chain is only the starting point, not the endpoint. With 56% of assets having zero weekly trades, $32.9 billion in idle value, and a highly concentrated market structure—these data remind us that RWA still has a long way to go before becoming a truly liquid, efficient, and usable financial market.

However, this does not mean the RWA narrative is “an illusion.” As multiple experts have pointed out, the current state looks more like an early stage of market development—assets are already on-chain, but the infrastructure that makes them truly run is still being built.

The future focus of competition is becoming clear: not who can issue more tokens, but who can build better liquidity infrastructure, more complete cross-chain interoperability solutions, and clearer regulatory connections. In RWA’s second half, the test is the market-building capability—not the speed of asset issuance.

FAQ

Q1: What is the real size of the RWA market?

As of May 2026, the tokenized RWA market size excluding stablecoins and repurchase agreements is approximately $6 billion. If only distributed assets freely tradable on public chains are counted, as of early July 2026 it is about $60B. There are differences across data standards, but all show significant growth.

Q2: Why don’t more than half of RWA assets have any trading activity?

Main reasons include: many “representative assets” are essentially digital records of off-chain holdings rather than tradable products; many assets lack market makers and secondary markets; whitelisting and compliance restrictions prevent free circulation; and liquidity is fragmented across different blockchains, preventing assets from reaching a broader capital pool.

Q3: What position does tokenized U.S. Treasuries hold in the RWA market?

Tokenized U.S. Treasuries are currently the only RWA category that has reached “production-grade” maturity. As of July 2026, its size is about $60B, representing nearly half of the RWA market. Its success comes from clear pricing, a deep underlying market, transparent yield streams, and its practicality as DeFi collateral.

Q4: What are the main regulatory challenges currently faced by RWA assets?

Regulatory frameworks vary enormously across jurisdictions. The U.S. is strict in the securities characterization of RWA tokens; the EU has established unified rules through MiCA; and in Asia, sandbox and licensing systems are advancing implementation. This divergence may lead to regional liquidity islands, and compliance costs also become entry barriers for small and midsize projects.

Q5: Where is the next growth point in the RWA market?

Tokenized stocks are becoming a new growth engine. As of July 2026, the market cap of tokenized stocks is about $33.5B; monthly transfer volume grows 87% to $8.76 billion, with a growth rate of roughly 40 times that of Treasuries. In addition, categories such as real estate, private credit, and green assets are also exploring pathways to get on-chain.