Real World Asset Sector Outperforms on Growing TradFi Tokenization Effort

RWAs are surging driven by Goldman Sachs’ tokenization initiative, and MakerDAO’s plan to invest $1 billion in the sector.

Real World Assets (RWA) tokens are leading the altcoin bounce during the recent crypto market’s rally.

MakerDAO is up 29% over the last 7 days, and Mantra has rallied over 70% in the last 30 days. Comparatively, Bitcoin is up 12.5%, ETH is up 13.5% and the Layer 2 token index is up 18%, over the last week according to CoinGecko.

The strong price action comes as institutional interest surrounding RWAs picks up steam.

Tokenization Grand Prix

MakerDAO announced its Spark Tokenization Grand Prix on July 11, which is a competition set to onboard up to $1 billion in tokenized assets. Applications for the competition will open on Aug 12, and it is focused on short-duration treasury bills.

Carlos Domingo, the CEO of Securitize, Blackrock’s issuance partner, took to social media and said “Great move by @makerdao. We will be there supporting this initiative with Blackrock’s BUIDL.”

Goldman Sachs’ RWA Interest

On July 10 Goldman Sachs’ head of digital assets, Matthew McDermott told Fortune that the multi-trillion dollar investment bank plans to launch three projects related to tokenization before the end of 2024, including one in the United States.

Goldman Sachs’ potential move would mark the third major financial institution to get involved in RWAs following Blackrock and Franklin Templeton.

$BUIDL, or the Blackrock USD Institutional Liquidity Fund, launched on March 20, and is Blackrock’s tokenized fund on Ethereum that is backed by traditional assets such as US Treasury Bills.

Franklin Templeton launched a similar product in April 2021 called $FOBXX (Franklin OnChain US Government Fund), and became the first US registered fund run on blockchain. $FOBXX originally launched on Stellar, and expanded to Polygon in April 2023.

Blackrock’s tokenized treasury fund, $BUIDL surpassed $500 million on July 8, and Franklin Templeton’s $FOBXX eclipsed $400 million on June 26.

The market capitalization of tokenized treasuries has steadily been growing since the start of 2023. Its total value is up another 3.4% over the last 7 days, and has increased by 136% since the beginning of 2024.