RWA Crypto : Complete guide – Advantages and how to invest

Intermédiaire
Temps de lecture : 4 minutes

Real world assets (RWAs) in crypto refer to the transformation of tangible or intangible assets, such as real estate, art, or even precious metals, into digital tokens stored on a blockchain. This approach links the physical world to decentralised finance (DeFi), offering a new dimension to investing in and using cryptocurrencies. RWAs matter because they introduce real, stable value into the crypto ecosystem, which is often criticised for its volatility and lack of links to the real economy. By tokenising real assets, we create accessible, liquid, and secure investment opportunities on the blockchain.

How do RWAs work?

Tokenisation is at the heart of how RWAs work. This process converts the property rights of a physical or intangible asset into a digital token on the blockchain. Here are the key stages:

  1. Asset selection: Choice of the actual asset to be tokenised, such as a building or a work of art.
  2. Valuation and audit: Determining the value of the asset and carrying out an audit to guarantee its legitimacy.
  3. Creation of the legal framework: Establishment of a legal framework for tokens, defining the rights and responsibilities of holders.
  4. Token issuance: Creation of tokens on a specific blockchain, representing ownership or a share in the real asset.
  5. Sale and exchange: Tokens can be sold or exchanged, offering liquidity and accessibility to investment.

The benefits of RWAs

RWAs offer a number of advantages for both investors and the overall market:

  • Accessibility: RWAs lower the barrier to entry for investing in high-value assets, enabling fractional investment.
  • Liquidity: Tokenisation improves the liquidity of traditionally illiquid assets, making them easier to buy and sell.
  • Transparency and security: Thanks to blockchain, transactions and ownership of RWAs are transparent and secure, reducing the risk of fraud.
  • Diversification: Investors can diversify their portfolios with real assets, reducing their exposure to the volatility of pure cryptos.
  • Potential returns: RWAs offer new opportunities to generate income, such as rents or dividends, adding value for investors.

The disadvantages of RWAs

Investing in RWAs presents challenges and limitations that are important to understand:

  • Legal and regulatory complexity: Tokenisation of real assets involves navigating a maze of laws and regulations that can vary greatly from one country to another.
  • Liquidity risks: Although tokenisation can improve liquidity, not all RWAs benefit from the same level of interest or demand, which can affect the sale facility.
  • Start-up costs: Initial costs for creating and managing RWA tokens, as well as for audits and legal compliance, can be high.
  • Security and fraud: Despite the security provided by blockchain, RWAs are not immune to attempts at fraud or security breaches, particularly in the link between the physical asset and its digital representation.

The best RWA cryptos

Here’s a list of the most promising RWA projects in the crypto space, reflecting a variety of assets and approaches:

  • MakerDAO (DAI ): Uses RWAs as collateral to issue its stablecoin, DAI, stabilising its value.
  • RealT: Offers the opportunity to invest in tokenised real estate, enabling investors to buy shares in residential real estate in the United States.
  • Tinlake (Centrifuge): Platform that enables the tokenisation and financing of various assets, including bills, home loans and more.
  • Stably: Provides a platform for the tokenisation of assets, including precious metals, offering a stable alternative to volatile cryptocurrencies.

Examples of the application of RWAs

RWAs are used in a variety of practical applications, demonstrating their versatility:

  • Property financing: The tokenisation of property allows investors to buy shares in properties, making property investment more accessible and divisible.
  • Art and collectibles: Works of art and collectibles can be tokenised, allowing investors to acquire shares in high-value objects, and artists a new monetisation channel.
  • Loans and credit: Companies can use real assets as collateral to obtain loans in the DeFi ecosystem, opening up new avenues of financing.
  • Agriculture and raw materials: The tokenisation of agricultural production and raw materials is enabling a more transparent supply chain and innovative financing mechanisms.

Conclusion

RWAs in crypto represent a major breakthrough in the way tangible and intangible assets are invested, managed and traded. By tokenising real assets, RWAs offer a new layer of liquidity, accessibility and security in investment, while bringing the stability of real value to the often volatile crypto ecosystem. The benefits, such as investment diversification and income generation, are considerable, but the regulatory and security challenges should not be ignored.

In the future, RWAs could play an even more central role in decentralised and traditional finance, as new technologies and regulations are developed to improve their integration, security and efficiency. The continued evolution of RWAs is a testament to the relentless innovation in crypto and opens the door to previously unimaginable investment opportunities. By remaining informed and cautious, investors can navigate this promising space and potentially transform their approach to investing in real assets.

FAQ

What is an RWA in crypto?

An RWA (Real World Asset) is a real asset (such as real estate, art, precious metals) that is tokenised and represented on a blockchain, enabling it to be traded in the crypto ecosystem.

How do you buy RWAs?

To buy RWAs, you first need to find a platform that offers RWA tokens, create an account, and then you can buy tokens representing shares in real assets.

Are RWAs safe?

RWAs are considered relatively safe due to their link to tangible assets. However, as with any investment, there are risks, particularly in terms of liquidity and regulation.

How do RWAs generate income?

RWAs can generate income in a variety of ways, such as dividends for company shares, rents for tokenised real estate, or capital gains on the resale of tokens.

Are RWAs regulated?

Regulation of RWAs varies between jurisdictions. Many countries are working on regulatory frameworks for cryptocurrencies and tokenised assets, but the situation is constantly evolving.

Sommaire

Sois au courant des dernières actus !

Inscris-toi à notre newsletter pour recevoir toute l’actu crypto directement dans ta boîte mail

Picture of Soa Fy

Soa Fy

Juriste et rédactrice SEO passionnée par la crypto, la finance et l'IA, j'écris pour vous informer et vous captiver. Je décrypte les aspects complexes de ces domaines pour les rendre accessibles à tous.

Envie d’écrire un article ?

Rédigez votre article et soumettez-le à l’équipe coinaute. On prendra le temps de le lire et peut-être même de le publier !

Articles similaires

coinaute

FREE
VIEW