ON–206: Real World Assets 🌍

Coverage on US Treasuries, yield-bearing stablecoins, tokenized Pokemon cards, and more.

Feb 16, 2024

ON–206: Real World Assets 🌍

About the Editor: Spencer Noon is an independent angel investor. Looking to get in touch? DM him on Telegram or reply to this email and say hi πŸ‘‹


Real World Assets 🌍

β‘  RWA Overview ⛓️

πŸ‘₯ 21.co | Website | Dashboard

πŸ“ˆ Tokenized assets surpass $77.6B in market cap, 560% rise in government securities

  • Over $77.6B worth of assets have been tokenized on public blockchains. 97% of the AUM are fiat-backed stablecoins. They are the first tokenized asset that has reached product-market fit for supporting trading, crypto on/off ramps, and global remittances. During the high-interest-rate environment, the AUM of tokenized government securities increased by 560%, from $103M to $680M, as risk-free rates have become more attractive than the various yields offered in DeFi.
Source: Dune Analytics - @21co
  • Ethereum remains the industry’s financial hub, with 77% of the AUM ($1.85B), followed by Stellar with $336M AUM (13.9%). Aside from Ethereum, Polygon has the most diverse tokenized offerings, including Corporate Bonds, Government Securities, Real Estate, and Commodities. In contrast, other blockchains only have two to three categories of tokenized assets.
Source: Dune Analytics - @21co
  • Institutions have tokenized $415M+ worth of assets. Franklin Templeton has tokenized their Money Market Funds on Stellar and Polygon with $336M AUM. French private bank Societe Generale tokenized a $12M euro stablecoin, EURCV, on Ethereum. KKR and Hamilton Lane have tokenized their private funds via Securitize on Avalanche and Polygon. Siemens tokenized $63M corporate bonds on Polygon via Obligate.
Souce: Dune Analytics - @21co

β‘‘ Tokenized Treasuries 🌐

πŸ“ˆ Tokenized U.S. Treasuries Continue Growth to $850M, Led By Mountain Protocol

  • Mountain Protocol's USDM, a new stablecoin which passes on the yield from its backing U.S. Treasuries to its holders, grew by a factor of 30 from late October. Aided by Manta Pacific's token rewards program, USDM now has over 153M tokens in circulation.
Source: rwa.xyz
  • Subtracting USDM from tokenized treasuries however, paints a different picture β€” supply expanded by roughly 10% from late October to peak at $771M in late November but has since contracted by another 10%, ultimately landing at $690M.
Source: rwa.xyz
  • Becuase Mountain Protocol mints USDM on Ethereum, the Layer 1 is now home to nearly 60% of tokenized treasuries. That’s up from nearly 0% one year prior, when Stellar was the dominant blockchain for the tokenized assets.
Source: rwa.xyz
  • πŸ’¦πŸ”¬ Tx-Level Alpha: Superstate, a tokenized asset manager founded by Compound Finance's Robert Leshner, debuted its first fund, USTB, which invests in short-duration U.S. Treasuries. This transaction marks the first minting of the fund's tokens on Ethereum, kickstarting $10M of AUM.

β‘’ Ondo Finance 🌊

πŸ“ˆ Ondo Finance approaches $200M in total value locked

  • Ondo Finance is the market leader in the tokenization of real world assets with over $192M TVL in its cash equivalent products. Ondo recently launched USDY, its yield-bearing stablecoin, on multiple blockchains, including Ethereum, Solana, Mantle, and Sui. Ondo is now prioritizing efforts to drive the adoption, integrations, and liquidity of these tokens.
Source: DeFiLlama
  • In February of 2023, Ondo Finance launched OUSG (Ondo Short-Term US Government Treasuries), the first tokenized security to gain material adoption. The first anniversary of its inception just passed, with its predictable return evident in its one-year performance chart.
Source: ondo.finance/ousg
  • USDY(Ondo US Dollar Yield Token) is a tokenized note that builds on the early success of stablecoins to provide non-US investors a way to store dollar-denominated value while generating yield. USDY holders currently earn 5.10% APY.
Source: ondo.finance/usdy

β‘£ Polygon RWAs 🟣

πŸ“ˆ Polygon: the second biggest blockchain for RWAs (14%) and their use cases

  • Polygon is an Ethereum scaling solution which provides institutions with an onchain environment for RWAs and cheap gas fees. According to the RWA 2023 report, Ethereum is the largest blockchain for RWAs deployed onchain at 35%, followed by Polygon which hosts 14% of the RWA projects. Polygon has 27 tokenized asset protocols on its chain, making it the second largest chain behind Ethereum as well.
Source: RWA World Annual Report 2023
  • Tokenized cards are some of the common RWAs found on Polygon. Pokemon cards on Courtyard, an onchain card collection platform, have generated almost $1M in sales volume from 12,475 tokenized cards within the last six months. The platform has also tokenized baseball, Disney and Yugi-oh cards, for a total of ~16,000 tokenized cards.
Source: Dune Analytics - @polygon_analytics & @denze
  • Use cases for RWAs also extend to watches. ZwapX enables the sales and trades of physical watches in exchange for digital tokens. The platform has facilitated $70,300 in watches' trading volume so far, with 28 watches already being tokenized.
Source: Dune Analytics - @maxper
  • πŸ’¦πŸ”¬ Tx-Level Alpha: An Audemars Piguet Royal Oak Chronograph was sold for $46,000 USDT on Polygon via ZwapX.

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