Ideal Assets for Tokenization P2.1: Opening Up Hard‑to‑Access Markets
Understanding tokenization requires considering diverse influences, and this analysis highlights the importance of evaluating both theoretical possibilities and practical implementation.
Ideal Assets for Tokenization P.1: Regulatory Environment
My hypothesis: “Assets open to foreign and cross-border investment are ideal for tokenization.”
In Part 1 of this series, we explored how regulation shapes the tokenization map—essentially determining which assets can legally be tokenized and who’s allowed to access them. It set the foundation for a key hypothesis:
The more globally open an asset class is, the more natural it becomes as a candidate for tokenization.
Now in Part 2, we’re testing that idea in the wild. We'll look at the real-world asset classes that are already gaining traction on-chain—not just based on theory or regulation, but based on actual market activity, investor behavior, and platform-level data.
Let’s see where the friction is real, and where tokenization is already breaking it down.
1. Global Asset Classes: Assessing Openness to Foreign Investors
The ease with which foreign investors can access various asset classes plays a crucial role in their tokenization potential. Below is a ranking of major asset classes based on their relative openness to foreign investment:
My hypothesis is asset classes with higher openness are more likely to be amenable to tokenization due to fewer regulatory barriers and established market infrastructures. However, to what extent is this hypothesis accurate? The practical adoption of tokenization, as I've found, reveals a surprisingly nuanced reality.
Full Table: Global Asset Classes Table - From series Ideal Assets for Tokenization
2. Asset Classes Open to Global Investors: Ripe for Tokenization
According to RWA.xyz, the tokenized real-world asset market has experienced significant growth. As of 3rd Apr, 2025, the total value of tokenized RWAs (excluding stablecoins) surpassed $19 billion. Private credit leads this market with over $12 billion in tokenized instruments.
While openness is a significant factor, other elements such as market demand, liquidity, and technological compatibility influence an asset class's readiness for tokenization. The following asset classes are currently at the forefront of tokenization efforts:
💵 Stablecoins: On-Chain USD, Borderless by Design
Stablecoins providing digital representations of fiat currency U.S. dollar are by far the largest tokenized asset class, with over $200B in outstanding value led by USDT and USDC.
Why is this a big deal? For one, it gives people globally access to a stable currency (USD) without a bank account.
Why it works:
They're liquid and the asset (USD) is globally desired.
They’ve broken through capital controls and banking barriers. The wrapper (a token) bypasses traditional intermediaries.
They settle instantly, 24/7, and are extensively used in decentralized finance (DeFi) and as a medium of exchange in the crypto ecosystem.
Regulation varies, but many jurisdictions (e.g., EU via MiCA, Singapore) now formally allow them.
🛠️ Key Players: Tether (USDT), USD Coin (USDC), USDS (Sky Ecosystem), FDUSD (First Digital)
🇺🇸 U.S. Treasuries: Liquid, Safe, and Now Global
U.S. Treasuries are the world’s most liquid asset, yet surprisingly hard to access for global retail investors. Until now.
Today, tokenized Treasuries have surpassed $4.96B in value on-chain, with players like Ondo and Franklin Templeton offering fractional, tokenized T-bill products directly to crypto wallets.
Why it works:
High openness: Foreigners already hold U.S., EU, and JP debt.
Tokenization removes access friction (no brokerage needed, low minimums).
Facilitates fractional ownership, broadens access to retail investors, and enables 24/7 trading, instant settlement. DeFi integrations = huge upgrade.
🛠️ Key Players: Ondo Finance (OUSG), Franklin Templeton (FOBXX), Backed Finance (bIB01), Matrixdock (USDY)
💳 Private Credit: High Yields Meet New Liquidity
Private credit refers to loans made in private markets – for example, financing for mid-sized companies, real estate projects, or invoice factoring – typically issued by non-bank lenders or specialized funds.
Private credit is booming off-chain — and now, increasingly, on-chain too. It’s traditionally illiquid, opaque, and exclusively accessible mainly to institutional investors. but tokenization is starting to flip that.
Tokenized private credit pools enable fractional investments, enhance transparency, and create secondary markets. It gains $12.47B in active loan value, issued by protocols that connect real-world borrowers with DeFi liquidity.
These loans are averaging around 10% APR – attractive yield that used to be obtainable only via private debt funds or direct lending deals.
Why it works:
Tokenization brings transparency, programmability, and fractional ownership.
Investors gain exposure to high-yield loans with lower minimums.
Some liquidity exists via secondary markets and integrations with DeFi.
🛠️ Key Players: Centrifuge, Maple Finance, Goldfinch, TrueFi
🪙 Commodities: Hard Assets, Soft Entry
Take gold: Gold is the star here. it’s a universal store of value, but owning physical gold means dealing with bars, vaults, and insurance, while gold ETFs often come with fees and time-limited trading hours. Enter tokenized commodities – most prominently, tokenized precious metals like gold – which make these assets fractional, borderless, and easy to hold or trade.
With $1.3B+ in tokenized commodity value on-chain, this segment is becoming a go-to for inflation hedging and sovereign wealth diversification in token form. Commodities like gold are valued as hedges against inflation and economic uncertainty.
How it works: it simplifies ownership, storage, and transfer, making commodities more accessible to a broader range of investors.
🛠️ Key Players: Paxos Gold (PAXG), Tether Gold (XAUT), Cache Gold, Meld Gold
🏛️ Institutional Funds: Opening the Vaults
Institutional-grade investment funds – think private equity, venture capital, hedge funds, and other alternative assets – have traditionally been the domain of big investors and pension funds. They often require large minimum investments (six or seven figures) and long lock-up periods. Tokenization is poised to chip away at these entry barriers by creating digital shares of these funds that smaller investors can buy and trade.
Tokenized institutional funds have sat at $367M in value with 17 funds recorded on rwa.xyz and players like Securitize and Hamilton Lane leading the way.
How it works:
Tokenized funds increase liquidity, enables potential liquidity via secondary trading and broadens the investor base.
Tokenized funds requires lowers investment minimums, giving qualified investors access to previously gated private equity, VC, or credit funds — sometimes with minimums as low as $5K.
🛠️ Key Players: Securitize, ADDX, Hamilton Lane, Figure
🧩 Other categories: Tokenized Stocks & Tokenized Global Bonds
Do you see a discrepancy between the ranking of open asset classes and the top tokenized asset classes?
Why is there a mismatch between the top RWAs and the most open global asset classes for foreign investors?
Stay tuned for the next part!
Disclaimer: This content is for informational and research purposes only. DYOR!