Real-world assets overtake DEXs to rank 5th in DeFi TVL

Real-world asset (RWA) protocols have surpassed decentralized exchanges (DEXs) to become the fifth-largest category in decentralized finance (DeFi) by total value locked (TVL), according to DefiLlama. RWAs account for about $17 billion in TVL, up from $12 billion in Q4 2024, reflecting rapid adoption of tokenized Treasurys, private credit, and other on-chain claims. DefiLlama noted that at the start of the year, RWAs were not among the top 10 categories by TVL.

Vincent Liu, chief investment officer at Kronos Research, said the expansion is being driven by balance-sheet incentives rather than experimentation, with higher-for-longer interest rates making tokenized Treasurys and private credit attractive as on-chain yield instruments. He added that improving regulatory clarity is reducing friction for institutional allocators.

RWAs move into DeFi’s core

Earlier this year, RWAs excluding stablecoins reached roughly $24 billion, with private credit and tokenized Treasurys cited as the primary growth drivers. Ethereum remains the leading public settlement layer for on-chain debt and fund structures.

Throughout 2025, the market has been concentrated among a small number of large issuers and vehicles on Ethereum, while RWA.xyz data indicates a second tier of networks — including BNB Chain, Avalanche, Solana, Polygon, and Arbitrum — each holding low‑to‑mid single‑digit percentage shares of public‑chain RWA value.

RWA League Table | Source: RWA.xyz

In parallel, permissioned infrastructure such as Canton Network has emerged as a major institutional venue, with over 90% of total market share. It hosts large RWA programs in a privacy‑preserving, regulated environment that can connect to DeFi data and liquidity rails.

Drivers of flows

Tokenized U.S. Treasurys remain the primary entry point, with platforms such as the BlackRock USD Institutional Digital Liquidity Fund (BUIDL), Circle’s USYC, Franklin Templeton’s BENJI, Ondo’s OUSG, and similar products pushing the combined tokenized Treasury segment above the multi‑billion‑dollar mark by December.

According to Liu, the key constraint has shifted from tokenization to liquidity and integration with traditional finance. He said that in 2026, the focus should move from headline TVL to governance and utilization — including who controls issuance, how RWAs are deployed as collateral, and which venues capture secondary market activity.

Gold, silver, and the 2026 outlook

Rallies in gold and silver have added momentum to the RWA theme, drawing more capital into tokenized commodities. Recent data place the market capitalization of tokenized commodities near $4 billion, led by gold-backed products such as Tether Gold and Paxos Gold, which have expanded alongside rising spot metals, approaching new highs.

Liu said these developments are elevating tokenized commodities from niche RWAs to macro-relevant assets, with increasing demand for 24/7 on-chain access and settlement. He noted that clearer pricing and custody standards are easing integration with DeFi and institutional systems.

Looking to 2026, Liu pointed to behavioral validation as gold and silver break highs, arguing that price strength attracts issuance, which in turn brings liquidity and supports broader adoption beyond yield-focused narratives. He also highlighted interoperability as a key catalyst, with meaningful acceleration expected once tokenized commodities can move seamlessly across venues and chains and serve as neutral collateral rather than siloed products.

#DeFi #RWA #Tokenization #RWA Tokenization #Industry

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