Concept
Tokenization of real-world assets (RWA) means issuing digital tokens that represent rights to real assets: treasury bonds, fund units, real estate, private credit. The ownership record moves onto a blockchain, which enables round-the-clock settlement, fractional ownership, and programmability. For private capital these are familiar assets in a digital wrapper — carrying the same rights and obligations as their conventional form.
How it works
The underlying structure is simple. An issuer holds the real asset — a bond, a fund unit, a portfolio of loans — with a custodian or in a dedicated SPV, and issues tokens tied to that asset on a blockchain. Transferring a token changes the ownership record; the smart contract can restrict the pool of holders by KYC (whitelist), pay a coupon, and execute redemption on schedule. Custody of the tokens themselves is increasingly entrusted to qualified custodians rather than a personal wallet.
History
The idea grew out of the crypto market, but in 2024–2025 traditional finance picked it up. The launch of BlackRock's BUIDL fund in March 2024 showed that the largest managers were ready to issue tokenized products: the fund started at $100 million and passed $1 billion within a few months. Following BlackRock came Franklin Templeton with its BENJI fund, Ondo, Securitize, and others; by 2026 tokenization had gone from an experiment to a distinct line of institutional products.
Market Size
By mid-2026 the value of tokenized RWA on-chain, excluding stablecoins, had passed $30 billion — the market roughly tripled over the year. The largest segments are private credit and tokenized US treasuries: treasuries account for around $13–15 billion, and BUIDL remains the leading product with assets of about $2.4 billion. These are 2026 estimates and the figures move quickly.
Beyond treasuries, several other classes have passed the $1 billion mark: private credit, commodities, corporate bonds, non-US government bonds, and institutional alternative funds. Private credit is one of the fastest-growing segments — a token conveniently splits large, illiquid loans into fractions. Analysts at BCG and Standard Chartered estimate the market's potential at $16 trillion by 2030; that is a forecast, but it shows the scale of institutional expectations.
Stablecoins
A separate and the most mature class is stablecoins — tokens pegged to a fiat currency. Their combined capitalization by mid-2026 stood at around $300 billion, and they have become the settlement infrastructure on top of which the tokenization of other assets is built. Their types, structure, risks, and regulation are covered in a dedicated article, Stablecoins: types and regulation — what follows here concerns only the tokenization of assets themselves.
Regulation
Regulators caught up with the market in 2024–2026. The stablecoin perimeter is already in place — in the EU that is MiCA, with its split into EMT and ART, and in the US the GENIUS Act (July 2025); it is examined in detail in the article on stablecoins. For the tokenization of securities themselves, experimental DLT regimes are at work — the EU DLT Pilot Regime and the UK's Digital Securities Sandbox — which allow tokenized securities to be traded and settled while bypassing part of the classic infrastructure requirements.
The market's structure beyond stablecoins has not yet been settled in US law: the CLARITY Act cleared the relevant Senate committee in spring 2026 but has not yet been enacted and must be reconciled between the chambers. In parallel, a tax perimeter is taking shape — through CARF the OECD is introducing automatic exchange of information on crypto-assets: data collection began in 2026, the first exchanges will take place in 2027, and for some jurisdictions in 2028. For a token holder, reporting on them is gradually coming into line with CRS and FATCA.
Application for Private Capital
For a wealthy client, tokenization opens access to institutional products in digital form, to settlement without weekends, and to fractional ownership of large assets. The familiar questions remain, though: the issuer's jurisdiction, custody of the keys and holding the tokens with a qualified provider, tax status, and reporting.
Risks and Limitations
A token does not remove the risks of the underlying asset and adds its own. The secondary market is often thinner than for a conventional security, so a quick exit at a fair price is not guaranteed. On top of credit and interest-rate risk come smart-contract and operational risk, the risk of the token's issuer and custodian, and the safekeeping of private keys. Stablecoins have a distinct vulnerability — a break in the peg: in March 2023 USDC temporarily lost parity because of reserves stuck in the failed Silicon Valley Bank. Finally, regulation is still fragmented: the same token is classified differently across jurisdictions.
What's Next
Institutional money keeps coming in: in May 2026 BlackRock filed applications with the SEC for new tokenized funds and on-chain shares of a large money-market fund. Regulation is maturing — the GENIUS Act takes effect in 2027, and CARF reporting starts at the same time. On the horizon are network interoperability and "money-against-asset" settlement directly on the blockchain, without a separate clearing step. For private capital this means access to new products with the same due diligence as in classic private banking.
This material is for informational purposes only and does not constitute individual advice.