The next stop for RWA: from tokenization to RWAFi, opening a new era of financialization for real-world assets.

The entry of giants like BlackRock and Nasdaq has clearly indicated the trend of tokenization of real-world assets (RWA). However, moving stocks and bonds onto the blockchain is just the beginning. This article will delve into how RWA can transform from static assets into composable financial Lego blocks after tokenization, releasing tremendous potential through RWAFi (Real World Asset Finance), and is expected to lead the next wave of innovation on the level of DeFi Summer.

1. Tokenization is just the beginning: The key to unlocking RWA potential

Essentially, moving RWA assets such as US stocks and gold onto the blockchain has only achieved the "digital packaging" of assets, solving the issues of asset issuance and cross-regional circulation. However, if tokenized assets can only sit in wallets without the ability to be composable, it loses the core advantage of blockchain—composability. The introduction of RWA should greatly enhance asset liquidity and release new value through DeFi operations like lending and staking.

This is similar to Ethereum (ETH) before the DeFi Summer, when it could not be effectively utilized. It was not until protocols like Aave endowed it with collateral lending functions that it released liquidity in the hundreds of billions. If US stock tokens want to break through the dilemma, they must replicate this logic, allowing the stagnant tokens to become "collateralizable, tradable, and combinable living assets."

Case Study: Imagine that users can short Bitcoin (BTC) using tokenized Tesla stock (TSLA.M), or bet on the trend of Ethereum (ETH) with Amazon stock (AMZNX). At this point, these stagnant assets are no longer just "token shells," but are being used as margin assets. Liquidity will naturally grow from these real trading demands.

This is precisely the core essence of moving from RWA to RWAFi. However, the true value release requires far more than a technical breakthrough; it necessitates a systematic solution that encompasses the following aspects:

Infrastructure layer: Ensure secure asset custody, efficient cross-chain settlement, and on-chain clearing.

Agreement Layer: Provides standardized tools for developers and asset parties to integrate quickly.

Ecosystem layer: Deeply connected liquidity, derivative products, lending, stablecoins, and various DeFi protocols.

This reveals that the on-chain integration of RWA is not only a technical issue but also a systemic issue. Only by securely and with low barriers introducing RWA into diversified DeFi scenarios can the existing dividend of traditional assets be truly transformed into incremental value on the chain.

2. Bringing Real Assets to Life: Challenges and Pathways of RWA Financialization

The biggest problem in the current RWA Token market is not the "lack of targets" but the "lack of liquidity structure."

· The Lack of Financial Composability

In the traditional US stock market, the abundance of liquidity is not rooted in the spot itself, but rather in the trading depth constructed by derivatives such as options and futures. These tools support price discovery, risk management, and capital leverage, creating long and short speculation and diversified strategies, attracting institutional funds to continuously get on board, ultimately forming a positive cycle of "active trading → deeper market → more users."

However, the current tokenization market for US stocks is precisely missing this crucial layer of structure. The TSLA and AAPL tokens that users purchase mostly can only be "held" but cannot be truly "used." They cannot be used as collateral to borrow stablecoins in protocols like Aave, nor can they be used as margin to trade other assets on platforms like dYdX, let alone cross-market strategies based on them.

Therefore, although these RWA assets have arrived on the chain, in a financial sense, they are not yet "alive" enough, their capital efficiency has not been released, and the road to the vast world of Decentralized Finance is blocked.

· The Fragmentation and Disruption of Liquidity

This is also a more complicated issue. Different issuers have launched their own independent and incompatible token versions based on the same underlying asset (such as Tesla stock). For example, MyStonks' TSLA.M, xStocks' TSLAx, and Ondo Finance's TSLAon.

Different RWA tokenization projects' approaches to handling Tesla stocks:

MyStonks: Issue TSLA.M

xStocks: Issue TSLAx

Ondo Finance: Issuing TSLAon

This situation of "multi-hair coins" inevitably reminds one of the early dilemmas of the Ethereum Layer 2 ecosystem—liquidity being fragmented across isolated islands, unable to converge into a sea. This not only greatly dilutes market depth but also creates significant barriers for user and protocol integration, severely hindering the scalable development of the RWA ecosystem.

3. How to complete the missing puzzle? Building a unified RWAFi ecosystem

How to solve the above dilemma? The answer lies in building a unified and open RWAFi ecosystem that transforms RWA from "static assets" into composable and derivable "dynamic Lego blocks."

Therefore, the latest moves by Nasdaq are particularly worthy of attention. Once top traditional institutions like Nasdaq get on board to issue official stock tokens, it will fundamentally solve the trust issues at the source of assets. Within the framework of RWAFi, a unified RWA asset can be variously "financialized" - through operations such as collateralization, lending, staking, and anchoring, creating a value chain.

Importantly, this financialization is not limited to highly liquid assets such as U.S. stocks and bonds. Even those fixed assets that have extremely poor liquidity and combinability in the real world can be "activated."

The financialization potential of real estate RWA: Taking real estate, an asset with extremely poor liquidity in the real world, as an example, once it is standardized and introduced into the RWAFi framework, it is no longer "real estate" but becomes a highly dynamic financial component:

Participate in lending: Use it as high-quality collateral to conduct low-interest financing on-chain and activate dormant capital.

Automating income generation: Through smart contracts, monthly rental income will be automatically and transparently distributed to each Token holder in the form of stablecoins.

Structured Product Construction: Separating the "appreciation rights" and "rental income rights" of real estate and packaging them into two different financial products to meet the needs of investors with varying risk preferences.

This kind of "dynamic empowerment" actually breaks the inherent limitations of RWA and injects it with DeFi's native, higher-dimensional composability. Therefore, Nasdaq's tokenization of stocks is just the first domino; once they taste success with tokenized US stocks, a wave of on-chainization will come for various assets, from real estate to commodities.

Therefore, the real breakout point in the future will not be these assets themselves, but the derivative ecosystem built around them—collateral, lending, structuring, options, ETFs, stablecoins, yield certificates... All of these familiar DeFi modules will be recombined and nested on top of standardized RWA, forming a completely new "Real Yield Finance (RWAFi)" system.

If the DeFi Summer of 2020 was an experiment in "money Legos" centered around crypto-native assets like ETH and WBTC, then the next wave of innovation initiated by RWAFi will be a "asset Legos" game that is based on the value of the entire real world, grander and more imaginative.

When RWA is no longer just on-chain assets, but becomes the underlying building blocks of on-chain finance, a new round of DeFi Summer may perhaps begin from here.