Real-world Assets (RWA) on the Rise: TVL Breaks $170 Billion, Surpassing DEX to Become the Fifth Largest Pillar of DeFi

According to the latest data from DefiLlama, the total value locked (TVL) in real-world asset protocols has surged to approximately $17 billion, officially surpassing decentralized exchanges and becoming the fifth-largest category in DeFi by TVL. This milestone marks a shift in the development focus of DeFi, transitioning from purely crypto-native experiments to deep integration with and value capture from the real economy.

Reshaping the Landscape: How RWA Can Surpass DEX

The power dynamics in the DeFi space experienced a landmark shift by the end of 2025. RWA protocols successfully overtook DEXs, entering the top five core categories of DeFi, behind lending, liquidity staking, cross-chain bridges, and re-staking. This leap was not achieved overnight. Data shows that RWA’s TVL grew from about $12 billion in Q4 2024 to the current $17 billion, indicating a significant growth momentum.

Looking back to the beginning of the year, RWA even failed to make it into the top ten in the DeFi category. Now, it not only ranks in the top five but also attracts the attention of institutional and individual investors seeking “balance sheet incentives rather than experiments,” thanks to its stable and consistent yield characteristics.

Growth Drivers: Exploring the Core Reasons Behind RWA’s Explosion

The explosive growth of RWA stems from multiple key driving forces coming together in 2025. First, the demand for yields in a high-interest-rate environment. Persistently high interest rates make tokenized assets like U.S. Treasuries and private credit, which can provide stable on-chain returns, highly attractive. Second, the improvement in global regulatory clarity. Progress in regulatory frameworks in the U.S., Singapore, the UAE, and other regions has significantly reduced compliance friction and uncertainty for institutional capital entering this space. This paves the way for traditional financial giants like BlackRock and JPMorgan to launch their tokenized products. Lastly, the diversification and macro-hedging properties of the assets themselves. In 2025, rising prices of precious metals like gold and silver attracted capital inflows seeking inflation hedges and dollar risk mitigation into their tokenized products, further expanding the market size of RWA.

Market Composition: A View of the Trillion-Dollar Asset Map

The RWA ecosystem, valued at up to $170 billion, features a rich and diverse internal structure, extending from simple government bond tokenization to a broader yield curve. Tokenized U.S. Treasuries are undisputed as the foundational and “entry-level” products. Represented by BlackRock’s BUIDL fund, this sector has grown to a scale of tens of billions of dollars, providing underlying liquidity and credible anchors for the entire market. Private credit is the largest single category. As of December 2025, its market size reached approximately $15.9 billion, a 61% increase within the year. This reflects capital shifting from “risk-free rates” toward higher-yield assets seeking “credit spreads.” The tokenized commodities market has also rapidly emerged, with a market cap approaching $4 billion, led mainly by gold products like Tether Gold and Paxos Gold.

Additionally, tokenization of real estate, institutional funds, stocks, and other assets is progressing in parallel, forming a diversified and interconnected on-chain real asset network.

Core Breakthrough: The Paradigm Shift Brought by Composability

The key to RWA surpassing traditional asset securitization lies in the “composability” enabled by blockchain technology. This fundamentally changes the way assets are held and utilized. Tokenized RWAs are no longer passive investment holdings but become fundamental modules in DeFi Lego. They can be:

• Used as collateral in lending protocols like Aave and Morpho to borrow funds.
• Their income rights can be split and traded via protocols like Pendle.
• Provided as liquidity on secondary markets and derivatives platforms, enabling near-instant redemption and settlement.

This ability to transform “real assets” into “programmable components of capital markets” is the core advantage that differentiates RWA from traditional financial instruments and is the fundamental reason for attracting large amounts of crypto-native capital.

Future Outlook: From Scale Growth to Ecosystem Maturity

Looking ahead to 2026, the development focus of RWA is expected to shift from headline-driven TVL growth to deeper ecosystem maturity. Interoperability and liquidity will become key. The breakthrough will depend on whether tokenized assets can achieve seamless value transfer and reuse across different blockchains, trading venues, and financial protocols. Regulatory and standardization improvements are essential for healthy industry development. The industry needs to establish technical standards covering asset mapping, data interfaces, and transparent regulation to balance innovation and risk. Finally, the value anchoring to real economy services will become increasingly important. Successful RWA projects should focus on improving financing efficiency and transparency for high-value real assets such as green energy and infrastructure, which will be the long-term source of their vitality.

Investor Access: Exploring RWA Opportunities on Gate

As RWA becomes mainstream in DeFi, channels for investors to access this asset class are becoming increasingly diverse. Take Gate as an example, a platform dedicated to providing users with access to cutting-edge crypto opportunities. Previously, Gate launched tokens related to RWA concepts, such as INC from the WorldAssets project, and supported ecosystem development through activities.

For investors interested in entering the RWA space, closely monitor compliant trading platforms like Gate for timely updates on new asset listings. Before making any investment decisions, be sure to use Gate’s real-time market data features to check the latest prices, trading volumes, and conduct independent research.

The boundary between the real world and blockchain is dissolving. When BlackRock’s BUIDL fund generates yields on-chain, when hundreds of millions of dollars in private credit are tokenized and flow within DeFi pools, and when ownership of gold is divided and used as collateral for loans, a new financial system is quietly emerging. RWA surpassing DEX is not an endpoint but the beginning of a grander narrative: a programmable capital market driven by global liquidity, operating around the clock, and deeply rooted in the real economy, is transforming from blueprint to reality.