Real-world asset (RWA) protocols have surged to become one of decentralized finance’s fastest-growing sectors, overtaking decentralized exchanges (DEXs) to rank as the fifth-largest DeFi category by total value locked (TVL), according to data from DefiLlama.RWAs now account for approximately $17 billion in TVL, up from around $12 billion in the fourth quarter of 2024. The milestone marks a structural shift in DeFi, as tokenized US Treasurys, private credit, and commodities transition from experimental use cases into core onchain financial infrastructure.“At the start of this year, RWAs weren’t even in the top 10 DeFi categories,” DefiLlama noted — underscoring the speed at which onchain representations of real-world assets have gained traction.RWAs Move From Niche Experiments to DeFi’s Core PlumbingThe growth of RWAs reflects a broader change in how capital is flowing into crypto. Rather than chasing speculative yield, investors are increasingly deploying funds into onchain versions of familiar, yield-bearing financial instruments.Vincent Liu, chief investment officer at Kronos Research, said RWA expansion is being driven by “balance-sheet incentives rather than experimentation.”With interest rates remaining higher for longer, tokenized Treasurys and private credit offer predictable yield, while improving regulatory clarity has lowered friction for institutional allocators exploring onchain markets.Earlier in 2025, RWAs excluding stablecoins had already grown to roughly $24 billion, with private credit and tokenized government debt emerging as the primary growth engines.Ethereum Dominates, but Multichain RWAs Are ExpandingEthereum continues to dominate as the primary public settlement layer for RWAs, hosting the majority of onchain debt instruments, tokenized funds, and credit structures.That said, data from RWA.xyz shows a growing second tier of blockchains gaining traction, including:BNB ChainAvalancheSolanaPolygonArbitrumEach currently captures low-to-mid single-digit percentages of public-chain RWA value, but together they point to a more diversified, multichain future for tokenized assets.Alongside public blockchains, permissioned infrastructure has also emerged as a major force. The Canton Network now hosts over 90% of total institutional RWA market share, providing a regulated, privacy-preserving environment that can still interoperate with DeFi liquidity and data rails.Tokenized Treasurys Lead RWA AdoptionTokenized US Treasurys remain the gateway product pulling capital onchain.Platforms and funds driving this segment include:BlackRock’s BUIDLCircle’s USYCFranklin Templeton’s BENJIOndo’s OUSGTogether, these vehicles have pushed tokenized Treasury exposure into the multi-billion-dollar range, cementing government debt as a foundational onchain yield product.Liu noted that as the sector matures, the constraint is no longer tokenization itself, but rather liquidity, secondary markets, and integration with traditional finance systems.Looking into 2026, he expects focus to shift away from headline TVL figures toward deeper questions:who controls issuance, where RWAs are used as collateral, and which venues capture secondary-market flow.Gold, Silver and Commodities Add a New Growth LegRallies in gold and silver are adding fresh momentum to the RWA narrative, pulling new capital into tokenized commodities.Recent estimates place the tokenized commodities market near $4 billion in market capitalization, led by gold-backed products such as Tether Gold and Paxos Gold, which have expanded alongside rising spot prices.Liu said the recent metals rally is “elevating tokenized commodities from niche RWAs to macro-relevant assets,” as investors demand 24/7, onchain access and settlement during periods of heightened volatility.As prices rise, issuance attracts liquidity, which in turn reinforces adoption — creating what Liu described as “behavioral validation” beyond simple yield-seeking.What Comes Next for RWAs in DeFi?Looking ahead to 2026, several themes stand out:RWAs are now foundational DeFi building blocks, not side experimentsTreasurys and private credit anchor onchain yieldCommodities introduce macro relevance and volatility hedgingInteroperability will be key, especially as RWAs evolve into neutral collateral that can move seamlessly across chains and venuesAs RWAs continue climbing DeFi’s rankings, the sector is increasingly shaping the bridge between traditional finance balance sheets and blockchain-native liquidity — a shift that could define the next phase of onchain finance.
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