Article: Max.S

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On August 27, Binance founder Zhao Changpeng (CZ) said while attending the “Crypto Finance Forum 2025” held at the University of Hong Kong that RWA is not easy as expected. In

particular, if non-financial RWA assets themselves are not highly transactional, they may fall into insufficient liquidity.

In the future, rental income from any property in the world, ownership of fragments of a rare piece of art, and even part of the proceeds from a private equity loan can be traded as easily as trading stocks. “Real World Asset (RWA) tokenization” depicts such an exciting and grand blueprint. It needs to inject blockchain technology into traditional finance to break physical and geographical restrictions. Assets such as real estate, art, private equity, etc. that were bulky, unstandardized, and difficult to

circulate will be transformed into digital tokens that can be traded frictionlessly around the clock on the chain, and their liquidity potential will be completely unleashed.
It sounds like

a financial revolution is about to disrupt Wall Street; it sounds like that. With the rapid development of technology, as of mid-year, $240 to $25 billion in real-world assets (not counting stablecoins) have been successfully moved to the blockchain, involving 15 different blockchain ecosystems. If you let go of the fog of booming market capitalization and delve deeper into the most fundamental question, an embarrassing reality pops up: everything can be tokenized, but can it really be sold? An in-depth research report published in 2025, with detailed data and examples, ruthlessly shakes out a secret that everyone in the RWA field understands: we have mastered the magic of digitizing everything, and the market that allows these digital assets to flow freely has not yet been built. In the RWA story, the mobility part sounded most tempting, but it's still the most fatal bottleneck

.

An

image of prosperity: A 10-billion market made up of “piggy banks”

. Looking at the RWA market data for the first time, its astonishing growth curve may be astonishing. The rise of an emerging market worth tens of billions of dollars in just a few years seems to prove the huge success of tokenization. However, if you look closely at its composition, you will find that this boom is very misleading. Currently, the two giants, private equity credit and tokenized

US Treasury bonds, almost split the entire RWA market and occupy the vast majority of the market share.
The

reason these assets are dominant is simply that they are “on-chain piggy banks” exclusive to institutions and high-net-worth users. In the DeFi sector, investors can buy BUIDL, a tokenized money market fund issued by traditional financial giants such as BlackRock, or hold tokenized US Treasury bonds through platforms such as OndoFinance to reap stable and impressive returns. The main appeal of these products is “income” rather than “trading”. After purchasing, investors tend to hold interest at maturity without changing hands as frequently as trading cryptocurrencies. Although the market capitalization is very large, the mainstream of this market is the static model of “buy and hold” rather than the active secondary trading market that everyone

is looking forward to.

What's even more ironic is that in the RWA market, the asset classes that can theoretically benefit the most from increased liquidity, such as real estate, art, and SME loans, account for only a very small portion. In the case of tokenized real estate, its total market value is about 300 million US dollars. As for niche categories such as art and carbon credit, it only fluctuates around 100 million US dollars. This shows a core contradiction: the most successful application of tokenization technology is to digitally package assets with good liquidity or low volatility, rather than actually taking down the difficult bone of structural “non-liquid” assets. A gorgeous digital vault has been built, and it turns out that most

of it contains time deposits, not cash that can be traded at any time.

Cold on-chain data proves that if RWA's high market capitalization reveals the macro-structure of the problem, on-chain microdata will settle

the lack of liquidity in a colder way. Researchers analyzed data from platforms such as RWA.xyz and Etherscan to outline a real picture of liquidity from the dimensions of token holder dispersion,

monthly active addresses, and transaction frequency.

In the case of BlackRock's BUIDL token, which is the most prominent star in the market, it has always held the highest market value among RWA assets, with a total value of 2.42 billion US dollars, and monthly transfers of more than 1.8 billion US dollars. At first glance, these numbers are quite impressive, but if you look at a few more indicators, you'll immediately understand that this asset has only 85 holders, and only 30 addresses are actually active every month. This shows that most of its huge capital flows occur during the minting and redemption process between the project party and a small number of institutional investors, and there are almost no open secondary market transactions of the kind we understand

.

In the RWA sector, the phenomenon of “high market capitalization and low vitality” is very common. Many tokens serving institutions have less than 10 active addresses per month. Just as there are only 6 TRSY (tokenized treasury bonds) holders issued by Centrifuge, another study pointed out the problem more bluntly: Scholar Swinkels conducted an empirical analysis of residential real estate tokens issued on the RealT platform and found that each token changes hands once a year on average. However, stocks in developed markets usually change hands much more often every year. This nearly stagnant turnover rate has ruthlessly debunked the myth of “tokenization = high liquidity”. The performance of these so-called “liquid assets” on the

chain is like a dead end.

However, there are exceptions to everything. Although the RWA market is largely silent, tokenized gold products such as PAXGold (PAXG) and TetherGold (XAUT) are not the same. They are full of energy. PAXG holders have over 69,000 monthly transfers, and on-chain activity records show that it has been trading for more than five years, and the transaction cycle is stable and continuous, which is completely different from the short, isolated and explosive transfers of other RWA tokens.

Why do gold tokens dominate? The answer lies not in gold itself; in terms of “market access,” the vast majority of RWA tokens are trapped in a permissioned, fragmented trading environment. However, PAXG and XAUT are different. They are listed on mainstream centralized exchanges such as Binance and Kraken, and decentralized trading platforms such as Uniswap, with a wide range of trading channels and no permission required. This has greatly lowered the entry threshold for retail investors and institutional investors, and provided a real-time price discovery mechanism and deep market depth. PAXG's success is like a mirror

, reflecting the fundamental problem of other RWA assets: the lack of an open, unified, and easy-to-access trading market.

The

invisible shackles of liquidity: Four major structural barriers Why did assets move

to the blockchain but not bring the expected liquidity? Behind this, there are four structural shackles that have locked RWA

's liquidity doors together.

First shackle: Under the supervision of the “Invisible Wall,” most RWA tokens are classified as “securities” at the legal level and are subject to strict securities regulations, and issuers can only set heavy thresholds for compliance. If only users who have passed “Know Your Customer” (KYC) verification or are certified as “qualified investors” are allowed to participate in transactions, the “white list” mechanism guarantees compliance but also minimizes the scope of potential buyers and sellers, thereby stifling the breadth and depth of the market. Investors have to complete complex off-chain signing and authentication processes before trading

. The transaction process is not as “frictionless” as advertised.

Second shackle: There is a “fragmented island” phenomenon in the market. Imagine if there were no central exchanges such as the NYSE or NASDAQ, stocks could only be traded on hundreds or thousands of small trading apps that are not compatible with each other. The RWA market is currently facing this situation. Various decentralized exchanges (DEX), professional alternative trading systems (ATS), and informal OTC (OTC) networks are scattered across assets. Each platform is like a liquidity island. Due to the lack of a unified central market that can gather order flows, price discovery efficiency is low and transaction

costs are high.

Third shackle: There is a “black box problem” in valuation. How can a small specific property or a unique personal loan on a chain be accurately priced? RWA is different from homogenous crypto assets such as Bitcoin. Each RWA has unique risk, legal, and value characteristics, and fair value is extremely difficult to determine due to this heterogeneity. It is difficult for traders to reach consensus on asset values due to asymmetric information, so there is a huge trading price spread. Investors often require a “liquidity discount” to make up for this uncertainty and potential exit difficulties, which further depresses asset prices and forms a self-reinforcing “illiquid spiral.”

Fourth shackle: In mature financial markets, the role of “market makers” (Market Makers) is critical. They guarantee market liquidity and reduce price spreads by continuously providing trading offers. However, in the current RWA ecosystem, there are very few professional market makers, leading to a “lack of role” in the ecosystem. Although some DeFi protocols want to use liquidity mining and other means to incentivize users to provide liquidity, these incentives often fail to attract and maintain a stable liquidity pool for RWA tokens with

low trading volume and non-homogenization.

Technical and operational issues such as high on-chain transaction fees (GasFee) and barriers to interoperability between different blockchain networks have further exacerbated the liquidity dilemma.

The path to breaking the game: Building a multi-dimensional bridge to liquidity

faces such a serious challenge, is the future of RWA bleak? I don't think so. It emphasizes that liquidity issues can be solved, but systematic innovation and construction must be carried out at various levels, such as laws, market structures, financial instruments, and infrastructure. Here are a few game-breaking ideas:

Embracing a “hybrid” market structure, pure decentralized or centralized models have drawbacks, and a hybrid model combining the two may be the best solution. Specifically, regulated centralized platforms can be used for initial asset issuance, compliance review, and escrow to ensure the authenticity and legality of assets, and then connect compliant tokens to open decentralized agreements for secondary market transactions and circulation through technical bridges. This can not only meet regulatory requirements,

but also create liquidity through DeFi composability and automated market makers (AMM).

Explore “collateral is liquidity”. Not all liquidity can only be obtained by selling assets directly; “mortgage lending” is a more ingenious method. MakerDAO's exploration is very inspiring. It is one of the largest decentralized stablecoin agreements, and has begun to use RWA such as tokenized US short-term treasury bonds as collateral for the stablecoin DAI. In other words, RWA holders can lend DAI and obtain the required working capital without selling assets. This “indirect liquidity” model is undoubtedly the perfect solution for assets suitable for long-term holding but occasionally requiring capital turnover, such as real estate and private equity.

Consolidate the foundation and improve the ecosystem. Flowing living water requires a solid riverbed to carry it. This includes: Regulatory modernization: Actively promoting regulatory innovation, such as using frameworks such as the EU's DLT Pilot System (EU Pilot Scheme) to appropriately relax entry barriers on the premise of protecting investors, so that a wider range of groups can participate. Establish more professional data analysis platforms like RWA.xyz

to provide standardized asset disclosure and third-party valuation reports to reduce information asymmetry.

Develop institutional-grade facilities: Design more attractive incentives, such as allocating part of the income generated by the assets themselves (such as interest on bonds) to liquidity providers to encourage them to inject vitality into the market. Build secure and reliable institutional-grade escrow

solutions and compliant tokenized stock exchanges to enhance market confidence and reduce transaction risks.

Written at the end,

back to the original question “Can everything tokenized be successfully sold?” The answer is: Not now, but there is hope for the future. Although RWA's tokenization technology has proven to work, this is only the first step in the Long Mile Journey. Building a mature, well-developed, and coordinated marketplace ecosystem is the real challenge. Liquidity doesn't happen without reason; it needs to be carefully designed and nurtured. “Improving liquidity” must be changed from a beautiful vision to the core and priority of RWA project design. Only when regulatory barriers are broken, market silos are connected, and the valuation black box is illuminated will the era of truly efficient and inclusive RWA

transactions come.