Sergey Nazarov, co-creator of blockchain oracle service Chainlink (LINK), says that one burgeoning sector of the digital asset space is set to become a leading trend.
Nazarov tells his 150,000 followers on the social media platform X that real world assets (RWAs) look poised to become the next big trend in blockchain.
The RWA trend in crypto aims to tokenize assets in traditional markets like real estate, loans, bonds and more on-chain.
Says Nazarov,
“Real World Asset (RWA) tokenization is the next big trend in the blockchain industry, and I believe it is on track to hold more on-chain value than cryptocurrencies…
The amount of value that can be quickly turned into an RWA is in the tens of trillions, with only a very small percentage currently being in the RWA format. This includes all commodities, all real estate, all funds, and much more.
Large institutions like Blackrock, Fidelity, and others are already participating in the RWA trend through tokenized funds, with many more to come.”
Nazarov says that on-chain RWAs are a “superior format” for secure ownership and transferability of assets, and notes that they can be purchased and transferred across different countries and financial systems with less friction than the traditional infrastructure.
RWAs, according to the Chainlink creator, provide easier access to global liquidity – something that he says has facilitated the growth of cryptocurrency for years.
“RWAs have the ability to hold critical pieces of data that prove important things about the underlying asset much quicker and more effectively than traditional systems. Good examples are Chainlink’s usage to put NAV (net asset value) data on-chain for large CSDs (central securities depositories) and proof of reserve about the current state of an underlying asset.
RWAs are in the very early stages of creating efficiency for their assets using on-chain logic. As more of a fund’s administration/operations goes on-chain, you eventually get to huge increases in efficiency with even large decreases in the costs of operating a fund.
For example, the placing of NAV data on-chain at faster rates than the current system can massively speed up the timeline on which you can redeem, lowering it from months to minutes, which has a large economic benefit.”
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