RWA Market Size into Question
Although there has been increasing interest in tokenization of real-world asset (RWA), the space remains overhyped and underdeveloped, according to Chris Yin, CEO and co-founder of Plume, a Galaxy Digital-backed tokenization platform.
Interviewing from the Token2049 conference in Dubai, Yin dismissed the usually-cited $21 billion size of the tokenized RWA market. The estimate grossly overstates genuine adoption and deployment of capital, he said.
I tend to think that one, all the data are wrong, and two, the perspective held by most people is wrong,” Yin said. “I am utilizing this $21 billion in assets, but in reality, it is more like $10 billion.”.
As Yin explains, today’s market is primarily composed of tokenized U.S. Treasury bills, gold, and limited private credit. This is opposite to more optimistic metrics such as those provided by RWA.xyz, which put the market cap at $17.4 billion as of April 27.
Institutions Are Not Joining In—Yet
Yin went on to stress that institutional capital is still largely absent from the realm of tokenization, primarily because the market is currently too early in its life cycle.
“These things take a glacial pace. You have to show value, you have to show adoption first,” he said, likening the current stage of tokenized RWAs to the infancy of Bitcoin in 2013.
The assumption that institutions will lead tokenization from the outset is misplaced, Yin argued. He suggested that their role will only materialize once they see immense commercial potential.
“They are looking for a angle to preserve profitability, not preserve profitability,” Yin said. “Nobody cares about efficiency. Specifically Larry Fink—$12 trillion asset manager.”
Even very successful institutional offerings, like BlackRock’s $2.5 billion tokenized money market fund, are similarly a drop in the bucket compared to the company’s entire asset base.
Fragmented Data Clouds RWA Estimates
Other industry participants are similarly dubious, like Ross Shemeliak, co-founder of tokenization infrastructure firm Stobox. In Shemeliak’s view, it is extremely difficult to accurately estimate the size of the RWA market due to opaque private market data.
“The private side is highly fragmented and typically not available,” he explained, suggesting Treasurys and bonds—rather than private credit—making up 60–65% of the room today.
Shemeliak pointed out the untapped potential of small and medium-sized enterprises (SMEs), which are the vast majority of worldwide companies and are still mostly excluded from capital markets.
“99.9% of all firms worldwide are private. Tokenization provides a new path to capital and liquidity for them.”
Institutions Will Be Key to Scale
Whereas institutions are now being displaced by Web3 startups and DeFi protocols spearheading today’s tokenization rush, Shemeliak pushed back that institutions would be crucial to achieving real market scale.
“Tokenizing RWAs without institutions is like attempting to launch a stock exchange without regulators, custodians, and settlement layers,” he said.
Tokenized RWAs are naturally compliant financial instruments meant for institutional-scale use. They involve regulated securities, interest-bearing agreements, and structured governance—factors that resonate with institutional finance, not bottom-up crypto initiatives.
“The innovation can start with crypto-native players, but to make RWAs work, you need to have fund managers, underwriters, and regulated platforms in the mix,” Shemeliak concluded.
Despite skepticism over current numbers and take-up rates, both Yin and Shemeliak agree that tokenization has long-term potential—if institutional incentives and infrastructure evolve in tandem.
