In 2026, the market for tokenized real-world assets (RWA) is anticipated to significantly expand, particularly within emerging economies, as stated by Jesse Knutson, head of operations at Bitfinex. These developing markets face challenges in capital formation and attracting foreign investments, which tokenization aims to alleviate by facilitating on-chain capital formation and removing the need for traditional financial intermediaries.
Knutson highlighted that emerging economies often adopt innovative technologies, such as stablecoin settlement, more rapidly than developed nations burdened by outdated financial systems. The tokenization process allows for the fractionalization of assets, making investments more accessible to retail investors who might otherwise find them prohibitively expensive.
He noted that fixed-income instruments, like US Treasuries, are popular in developed markets, while in developing regions, real estate and commodities are frequently tokenized. The total market capitalization for tokenized RWAs could reach several trillion dollars over the next ten years, contingent upon major issuers transitioning from pilot projects to actual market offerings. However, challenges such as legal enforceability of on-chain contracts and the need for liquidity remain significant hurdles.