Real-world assets (RWA) are traditional tangible and financial assets, such as real estate, invoices and loans, which can now be digitized and tokenized for integration into the DeFi ecosystem. Through tokenization, these assets are fragmented into smaller parts and represented on the blockchain, allowing them to be easily transferred and traded. This technology facilitates participation in global financial markets and allows investors to access previously inaccessible assets, while offering greater stability and diversification compared to cryptoassets.
According to recent information, the total value locked up (TVL) in real-world assets within DeFi has surpassed $6 billion. As in the Lending sector this reflects substantial growth in the adoption of Crypto RWAs in the decentralized financial ecosystem.
In this article, we will explore how leading platforms such as MakerDAO, Centrifuge and Goldfinch are integrating these real-world assets into the world of decentralized finance.
RWA: Real World Assets
The integration of real-world assets (RWA) into DeFi has been a relatively recent development, but it has had a significant impact on the ecosystem. The idea of tokenizing traditional assets and using them in decentralized finance began to gain traction as the limits of cryptoasset-only based DeFi became apparent, especially in terms of volatility and risk.
One of the first projects to explore this concept was MakerDAO, which began accepting real-world assets as collateral to issue its DAI stablecoin. Initially, collateral was limited to cryptoassets such as ETH, but the need for greater stability and diversification led to the introduction of RWA, such as real estate and tokenized invoices.
Another pioneer in this space was Centrifuge, which enabled companies to tokenize real-world assets such as invoices and use these tokens to raise funding through DeFi platforms. Centrifuge was notable for its focus on connecting the traditional economy with DeFi, making it easier for real-world assets to be used as collateral on platforms such as MakerDAO.
Over time, other projects such as Goldfinch have further expanded the possibilities, enabling loan financing in emerging markets through RWA Crypto, without the need for full over-collateralization. This innovative approach allows underserved regions to access capital through decentralized financing, highlighting the transformative role of RWAs in the DeFi ecosystem.
The evolution of RWAs in DeFi has opened up new opportunities for investors and borrowers, offering stability, diversification and access to funding that was previously out of reach for many. This trend continues to grow as more projects embrace real-world asset tokenization and integration with the DeFi ecosystem.
Total Value Locked of the RWA sector at DeFi
Currently, RWAs at DeFi are mainly grouped into several key categories:
For more details and updated statistics on RWA at DeFi, please refer to RWA Market Data.
MakerDAOknown for his DAI stablecoin, has been a pioneer in integrating real-world assets into DeFi. Here we highlight some of his recent contributions:
MakerDAO accepts RWA as collateral for the issuance of the DAI stablecoin. This means that it is possible to use real estate, invoices and other physical assets as collateral to generate stablecoins. This move expanded the reach and stability of the DAI ecosystem, allowing for more diversified backing and less reliance on crypto volatility.
MakerDAO has collaborated with Centrifuge to integrate real-world assets into its system. Through this collaboration, MakerDAO has begun accepting tokenized invoices as collateral, using Centrifuge's infrastructure to tokenize these assets and connect them to the Maker network.
The inclusion of RWA as collateral offers DAI users greater stability in their holdings, as real-world assets tend to be less volatile than cryptoassets. In addition, this opens the door to greater adoption of DAI in the traditional financial world.
Maker Dao
Centrifuge is a platform that enables the tokenization of real-world assets, facilitating their integration into the DeFi ecosystem. Below, we explore how it works and its main contributions.
Centrifuge allows companies to tokenize invoices and other real-world assets to access decentralized funding. By tokenizing these assets, tokens called Tinlake are created that represent fractional ownership of the underlying assets. These tokens can be used as collateral on DeFi platforms to obtain loans or generate returns.
Centrifuge has been instrumental in integrating RWA into MakerDAO, enabling tokenized invoices to be used as collateral for DAI issuance. This collaboration has opened up new opportunities for companies to access decentralized funding using their physical assets.
For investors, Centrifuge offers access to real-world assets that were previously out of reach for DeFi markets. This provides a way to diversify portfolios and generate more stable returns, since, as we said earlier, RWAs tend to be less correlated with crypto market volatility.
Interaction between Maker Dao and Centrifuge
Although Pendle Finance does not focus exclusively on real world assets (RWA), its innovative platform allows users to separate and trade the future performance of any tokenized asset, including Crypto RWA. This opens up new possibilities for optimizing passive income strategies within the DeFi ecosystem.
Pendle Finance allows users to tokenize the future returns of an asset, meaning they can independently trade and manage both principal and income generated by an asset, including RWA.
This functionality is especially valuable for real-world assets that generate stable income, such as tokenized bonds or property, giving DeFi investors access to more predictable and less volatile income streams.
By enabling the trading of RWA future returns, Pendle Finance offers investors a powerful tool to optimize their portfolios, allowing for both conservative and more speculative strategies depending on each user's risk profile.
With its focus on yield separation and trading, Pendle Finance expands the possibilities for DeFi investors, especially in the context of RWAs, allowing for more precise control and greater flexibility in managing income streams.
Goldfinch is a DeFi protocol designed to facilitate decentralized loan funding in emerging markets using real-world assets (RWA). Below, we explore how it works and its key innovations.
Unlike many DeFi protocols that require full overcollateralization, Goldfinch allows lenders to rely on a system of backers. These backers provide a fraction of the required collateral, making it easier for borrowers in emerging markets to access loans without the burden of providing full collateral.
Goldfinch focuses on increasing financial inclusion by connecting borrowers in underserved regions with affordable capital. Borrowers can tokenize real-world assets, such as invoices or property, and use them as collateral to obtain financing through the platform.
The backer system also acts as a decentralized risk assessment, where network participants evaluate the creditworthiness of borrowers. This allows for more accurate and efficient credit allocation, especially in markets with limited information or where access to traditional credit is restricted.
Goldfinch is expanding DeFi's boundaries by incorporating emerging markets and offering a more accessible and adaptable funding model.
Ondo Finance is a DeFi protocol that stands out for offering structured financial products, specially designed to integrate real-world assets (RWA) into the DeFi ecosystem. Below, we explore its main features and its relationship with RWAs.
Ondo Finance allows users to choose between different "tranches" or levels of risk and reward in their investments. This model is particularly relevant to RWA, as it allows investors to participate in financial products that reflect different risk profiles, from more conservative to riskier options.
One of Ondo Finance's key innovations is the tokenization of traditional assets, such as bonds and other financial instruments, and their incorporation into DeFi products. This makes it easier for investors to access more stable and predictable returns, linked to real-world assets.
Ondo Finance acts as a bridge between DeFi's capital and the traditional financial markets. By offering RWA-based structured products, Ondo enables DeFi investors to diversify their portfolios and gain exposure to assets that were previously out of reach.
With its focus on RWA integration and risk customization, Ondo Finance is positioned as a key player in the expansion of the DeFi ecosystem towards more sophisticated and accessible financial products.
Stablecoin Dai
The integration of real-world assets into DeFi, led by platforms such as MakerDAO, Centrifuge and Goldfinch, is opening up new opportunities for investors and businesses. RWA tokenization enables the creation of a more stable and diversified financial ecosystem, combining the best of both worlds: the innovation and accessibility of DeFi with the stability of traditional assets. As these platforms continue to evolve, users can expect further integration of RWA into DeFi, offering new ways to generate solid and stable returns.
