Liquidity Lags as RWA Market Races Toward $16T

The RWA (Real-World Asset) tokenization market is expected to exceed $16 trillion by 2030, according to projections that have been bolstered by the rapid growth observed in the sector. This expansion is driven by the increasing adoption of tokenized real-world assets (RWAs), which represent physical or traditional financial instruments on blockchain platforms. The market currently stands at a significant value, with $26.46 billion in total on-chain RWA value as of August 2025, according to analytics platform RWA.xyz. This data highlights the market’s trajectory and the potential for broader financial inclusion and innovation.

Tokenized assets encompass a wide range of categories, including government bonds, real estate, commodities, and private credit instruments. The largest share of tokenized RWA value is concentrated in private credit and U.S. Treasuries, while real estate and other alternative assets remain in early stages of adoption. Tokenized U.S. Treasuries, for instance, have seen a significant increase in market capitalization, climbing from under $1 billion in early 2024 to over $7.4 billion by mid-2025. This growth is attributed to the high on-chain yields and demand for secure, short-duration assets.

Despite the impressive market growth, secondary market liquidity for RWA tokens remains limited. Most RWA tokens are held by institutions or issued in closed environments with restricted trading. As a result, active secondary trading is difficult without broader exchange listings or robust DeFi integration. Academic studies have found that token ownership in certain categories, such as real estate, changes hands only once per year on average, suggesting limited trading activity. The absence of market makers and the lack of incentives for liquidity providers in many tokenized asset classes compound the challenge.

Commodities-backed tokens, however, have demonstrated stronger liquidity profiles. Tokens like PAXG and XAUT, representing gold and silver, are actively traded on centralized and decentralized exchanges, facilitating broader access and deeper market participation. These tokens benefit from significant holder dispersion and consistent secondary market activity, which is supported by the intrinsic appeal of gold as a globally recognized store of value. As of August 2025, PAXG alone accounts for over $940 million in total value and sees over 52,000 monthly transfers.

Regulatory frameworks are also playing a critical role in shaping the RWA market. In Hong Kong, the rollout of a new stablecoin licensing framework has spurred interest in tokenized assets, with mainland Chinese institutions pouring resources into blockchain-based products. The city’s Stablecoins Ordinance, effective since August 1, requires issuers to maintain high-quality reserves and comply with anti-money laundering controls. This regulatory momentum has prompted industry leaders to advocate for further market reforms, including the establishment of a blockchain-native asset registration system to streamline processes and shorten transaction times.

The structural barriers to liquidity include fragmented marketplaces, regulatory restrictions, valuation uncertainty, and the lack of market makers. To address these issues, several pathways have been proposed, such as hybrid market structures that combine regulated, centralized platforms for primary issuance with decentralized protocols for secondary trading. Incentivizing liquidity providers through structured rewards and improving transparency through standardized valuation methods are also seen as key strategies for unlocking deeper liquidity.

The rise of RWA tokenization has been supported by platforms like Headway NOVA, which launched its upgraded version, NOVA 2.0, to provide investors with easier access to tokenized real estate. The platform allows fractional investment starting at $25, enabling global participation in high-value real estate markets. Immediate dividend activation, fixed payout schedules, and enhanced liquidity options for reselling shares are among the features that aim to improve user experience and attract a broader investor base.

Looking ahead, the RWA market’s potential is contingent on overcoming these liquidity challenges. While the technical infrastructure for tokenization is now well-established, the surrounding legal, regulatory, and trust-based systems must evolve to support liquid secondary markets. This includes regulatory modernization, technological advancements like cross-chain interoperability, and financial engineering to incentivize liquidity provision. With these developments, the RWA ecosystem can transition from an issuance-centric model to a transaction-centric one, unlocking broader access, faster settlement, and more efficient capital allocation.

Source:

[1] RWA.xyz | Analytics on Tokenized Real-World Assets (https://app.rwa.xyz/)

[2] Skynet: RWA Tokenization Market to Reach $16T by 2030 (https://cryptonews.com/news/skynet-rwa-tokenization-market-16t-2030/)

[3] Tokenize Everything, But Can You Sell It? RWA Liquidity... (https://arxiv.org/html/2508.11651v1)

[4] Headway NOVA 2.0: next-level tokenized real estate amid global RWA boom (https://www.prnewswire.com/news-releases/headway-nova-2-0-next-level-tokenized-real-estate-amid-global-rwa-boom-302531715.html)

[5] Hong Kong sees surge in RWA tokenization as Chinese firms pile in (https://www.mexc.com/en-GB/news/hong-kong-sees-surge-in-rwa-tokenization-as-chinese-firms-pile-in/70647)