Why Tokenizing Real-World Assets on IOTA Is a Game Changer for Digital Finance

• Tokenisation on IOTA bridges the gap between the digital and physical worlds, enabling assets such as commodities, real estate, art, funds and more into digital tokens.
• IOTA’s scalability and feeless architecture make it the ideal network for RWA tokenization, and the network is already seeing rapid growth in the sector.

The tokenisation of real-world assets has become the anchor application of blockchain technology that has permeated the mainstream world, onboarding legacy finance into the sector. While most networks have tokenisation initiatives, IOTA is emerging as the best network, owing to its unique feeless and scalable architecture.

Tokenisation is a mega market already. According to asset manager 21.co, it’s worth $87 billion this year. Accounting giant McKinsey estimates that the tokenised market capitalisation could hit $2 trillion by 2030. Standard Chartered is even more bullish, predicting that by 2034, the tokenisation market could hit $30.1 trillion  Clearly, tokenisation is a big deal.

At its heart, tokenization converts tangible assets like real estate, commodities, funds, art and collectibles, intellectual property, data, gaming assets, and just about any other asset to digital tokens. These tokens can then be tracked, managed, stored, and traded on the blockchain.

Once the assets have been tokenized into digital tokens, they become easier to buy and sell. Imagine being able to buy a piece of land online in an instant with the full history of ownership and use of the land, eliminating the long costly process required, and cutting out the dozens of middlemen. This is exactly what tokenisation promises.

Tokenization on IOTA is a Game Changer

While tokenisation can be done on most blockchain networks, only. a few have laid a claim to the sector, and IOTA is chiefly among the top players.

One blockchain expert explains:

IOTA’s unique feeless, scalable architecture makes it ideal for tokenising RWAs. With no miners and no transaction fees, transferring real-world assets through tokens becomes frictionless, reducing costs and improving efficiency.

Mega Thread: #RWA + #IOTA

Tokenizing Real-World Assets (RWAs) on #IOTA is a game changer. It bridges the gap between the physical and digital worlds, converting tangible assets like real estate, commodities, or even art into digital tokens on IOTA's Tangle. Here’s why this…

— B effect.iota (@karlaxelm) September 25, 2024

In an interview with CNF in June, IOTA founder Dominik Schiener made it clear that IOTA is now fully focused on tokenization. He stated:

We believe [tokenisation]the silver bullet of cryptocurrencies. The ability to tokenise assets and make use of them in an immutable, self-determined fashion that does not require any middlemen is what’s missing in our current, highly digitised life.

He added that his vision with IOTA is “to bridge the real world to Web3 through our regulatory work; the use cases we pursue, such as RWA tokenization.”

Beyond the exchange of tokens, tokenization is expanding into lending, creating an entirely new ecosystem. A user can tokenize RWAs and use them as collateral, which they can borrow against. This would open up liquidity for trillions of dollars in assets.

With tokenization, TVL would also get a massive boost. All these assets would become part of a blockchain network’s TVL. Real estate, for instance, is estimated at $634 trillion this year, and this value would be put on-chain.