Beyond stablecoins, what’s fueling the tokenized RWA $30T explosion? Insights from Polygon Labs
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Tokenized real-world property (RWAs) reached just below $300 billion in 2025, with some projections putting the market at $30 trillion by 2034.
Much of the momentum is led by stablecoins, with Ethereum alone registering an all-time high provide of $165 billion this week. But in a world of high fees, high-friction, and clunky UX, are blockchain rails prepared to soak up such demand?
Despite the many developments in tokenized RWAs, crypto innovators are acutely conscious {that a} really seamless system stays a shifting goal.
“It’s evolving,” admits Aishwary Gupta, Global Head of Payments at Polygon Labs. With a background in web2 funds and treasury administration at American Express (“shifting cash throughout the borders”), for Aishwary, the downside isn’t the tech: the technical rails themselves are shifting quick.
“For Polygon, we simply upgraded to 1,000 TPS, and in two months, we’ll be round 5,000 TPS. So successfully, the infrastructure is accessible… You can scale Polygon to have 50,000 transactions per second if the demand is coming in.”
Aishwary maintains that the outdated scaling challenges are fading quick, but they’re rapidly being changed by different snags, corresponding to regulatory hurdles and liquidity bottlenecks.
In simply 4 years, the distinction is 180
Aishwary joined Polygon in 2021 as their “first full-time worker in DeFi.” Comparing the state of tokenized funds at present to again then, he says, the distinction is evening and day. Four years in the past, in accordance with Aishwary, the charges had been greater and the onboarding expertise far worse.
“Four years again, you’ll pay 5%, perhaps 10% as an on-ramp payment. You must strive 5 completely different on-ramps; perhaps one works. So, from that state of affairs to at present, it’s a lot simpler to exit and do these transactions and get on-ramps on your cash. We haven’t absolutely advanced, however from a four-year perspective, it has change into a lot smoother.”
The downside, Aishwary says, is that charges are formed by market construction and the patchwork of native guidelines:
“There are just one or two gamers specifically markets who’ve both acquired licensed or are in liquidity sandboxes. So the variety of people who find themselves successfully licensed to do the on-ramps and off-ramps is way decrease. Hence, you will notice all this arbitrage coming in…
On-chain, you’re nonetheless paying just one cent, even if you happen to transfer a billion {dollars}… It’s simply that regulatory arbitrage is in the means.”
Regulatory readability: who’s successful the tokenization race?
If stablecoin issuers and different tokenized RWA suppliers are profiting from regulatory arbitrage, the place are they going? Which areas are finest making ready for the multi-trillion-dollar explosion on this sector, taking the tech and operating with it, so to talk?
Aishwary factors to 4 major areas. The world’s monetary capitals, the U.S., Singapore, Europe, and the Middle East:
“These are the high 4 the place we’re seeing huge acceptance.”
The U.S. is main the cost, he says, having been a laggard for therefore lengthy, due to years of regulatory opacity. As BitMEX CEO Stephan Lutz instructed me a number of weeks earlier than, they [the Trump administration] virtually turned the state of affairs round in a single day with the GENIUS Act, which units out clear standards for stablecoin issuance and offers long-awaited regulatory readability to U.S. issuers.
Singapore is one other pioneer in the tokenized RWAs house, notably on the subject of stablecoins. Its Payment Services Act and Financial Services and Markets Act create a transparent licensing regime for digital token service suppliers, that are tightly supervised by the Monetary Authority of Singapore and aligned with worldwide AML/CFT requirements.
Major corporations like Nium, Zodia Custody, and Crypto.com have chosen Singapore for its modern cost rails and regulatory framework. Aishwary shares:
“Apart from U.S. {dollars} in the cost house, I feel we see the second-highest quantity in Singapore {dollars}.”
Europe comes subsequent for Aishwary for example of “sluggish and regular” progress. While the MiCA laws might do with some tweaks, he says they’ve performed “numerous due diligence” for stablecoin issuers, and established corporations like Bitstamp and Fireblocks now supply regulated digital asset cost companies beneath the MiCA regime.
Finally, the Middle East is just not trailing far behind. In Abu Dhabi, for instance, regulators have outlined necessities for banks issuing stablecoins, creating clear pointers for reserve administration and compliance.
Idle capital will all the time chase yield
Since Aishwary introduced up the GENIUS Act, I ask what he thinks about the yield clause, which prohibits stablecoin issuers from paying the holder any type of curiosity or yield. He says:
“The downside is that this capital, which is sitting in the banks, is sitting as a result of they’re accruing no less than some curiosity, not high, however nonetheless one thing. Now, if the similar greenback for you is supplying you with higher curiosity on-chain versus off-chain, then successfully you’ll need to preserve your greenback on-chain, which implies that it really impacts the whole banking movement.”
In truth, TradFi establishments and crypto-native asset managers alike are more and more in search of yield in on-chain merchandise like tokenized U.S. Treasuries, non-public credit score, and controlled money-market funds.
By mid-2025, tokenized Treasuries surpassed $7.4 billion in AUM, with main gamers corresponding to Goldman Sachs, BNY Mellon, and Securitize actively allocating capital to those merchandise for greater yield, prompt settlement, and versatile collateralization, typically outperforming standard off-chain financial institution devices.
Trends in tokenized RWAs past stablecoins
We flip from stablecoins to different developments inside tokenized RWAs. While tokenized shares have gotten a favourite speaking level amongst centralized exchanges like Kraken and Coinbase, and DeFi platforms like Synthetix and Mirror Protocol, Aishwary is as frank as he’s analytical:
“Everyone is in the frenzy of tokenized shares. They assume tokenized shares are the smartest thing. At Polygon, we did tokenized shares a yr and a half again. It doesn’t work. There’s no demand.”
I scratch my head and marvel why so little curiosity. He explains:
“Until you’re from North Korea and don’t have entry to Apple shares, I have already got entry to Apple shares in my checking account. Even sitting in India, even sitting in Dubai, wherever in the world. So you’re not likely really going to individuals who don’t have entry to it.”
Moreover, he says, liquidity stays an unsolved challenge.
“The liquidity on-chain can be a really huge downside proper now. They don’t have that a lot liquidity. So most of the time you’ll find yourself having a nasty quote or having a nasty charge.”
Not precisely the breakthrough many anticipated.
Commodities and non-USD stablecoins
Where does Aishwary see actual promise on this tokenized cash world? Two main developments that “persons are not specializing in sufficient but” are non-USD stablecoins and tokenized commodities.
“If you take a look at Polygon, we’ve got greater than 50 or 60% of the complete market share of non-USD stablecoins, and that’s rising. We’re really increasing on it much more. Commodities are additionally one thing, like gold, silver, to make them accessible and tradable.”
Globally, non-USD stablecoins now comprise round 30% of volumes in lively cross-border corridors exterior the United States.
For tokenized commodities, the world market dimension reached roughly $25 billion in 2024, with gold tokens alone valued at ~$1.7 billion and oil, silver, and agricultural commodity tokens steadily growing their share. Aishwary provides:
“We have these commodities or property on chain already, however they haven’t but grown in a means the place they change into an ecosystem of their very own, so that’s one thing which is lacking.”
The path to $30 trillion
As tokenized RWAs balloon into the trillions, it will likely be attention-grabbing to see how the house shakes out. With gold hitting an all-time high in strategic reserves as world governments race to build up extra of the arduous asset, it’s logical that tokenized gold will comply with.
In just some years, tokenization has moved from proof-of-concept pilots to world infrastructure, with billions now flowing into various real-world property throughout continents.
What’s subsequent isn’t nearly scaling up and clearing regulatory hurdles; it’s about how the trade can really unlock contemporary sorts of worth and usefulness, reaching far past what stablecoins have already begun.
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