Article reprinted from: WOO

Narrative

RWA (Real World Assets) refers to assets from the real world. Its value lies in bridging traditional assets with the Web 3 world, enabling the digital representation of real assets, thereby effectively utilizing or deploying real assets (such as real estate, artworks, etc.) to enhance asset liquidity. With the combination of RWA and blockchain technology, RWA can transcend geographical limitations. Regardless of geographical location, currency systems, or other influencing factors, users can conveniently complete transactions or utilize assets through this combination. When RWA is mentioned, people often think of real estate, stocks, and so on; from the basic characteristics of RWA tokenization, stablecoins also belong to the RWA track. It seems that RWA is closer to us than ever. This is another layer of the narrative of RWA, namely 'inclusiveness,' allowing investors without sufficient capital to enter high-value markets to indirectly invest in high-value RWA tokenized products.

What does the future hold?

In the past year, the overall TVL of RWA has shown a fluctuating upward trend. In this cycle, RWA, AI, MEME, and others are relatively popular tracks. RWA has always been one of the more closely watched tracks.

Image source: https://defillama.com/protocols/RWA

In the future, RWA is likely to continue its trend, and the combination of RWA and the DeFi track may attract more investors' attention. In fact, high-value assets like real estate and commodities face settlement difficulties in transactions, and the relevant laws and regulations vary by country, which greatly hinders the development of projects related to such high-value assets. Therefore, for projects in the RWA track to achieve better development, significant progress must be made in PayFi, cross-border settlement regulation, and RWA asset certification before relying on third parties for clearing or certification in various locations. Furthermore, stablecoin-related RWA projects are relatively stable, with the mainstream market likely still dominated by the U.S. dollar, followed by the euro. However, similar projects in the future may exhibit national/regional differentiation, with 'investors in a certain country/region generally opting for a specific stablecoin.' In such cases, stablecoins that obtain local regulatory licenses can seize the market. Lastly, a significant trend in the future may be that stablecoins are pegged to bonds, securities, stocks, or funds, leading to more products and projects emerging. The reason is that, as mentioned earlier, the settlement and regulatory aspects have advantages over assets like real estate. However, in the early future, only projects related to institutions (like BlackRock) with a certain voice in traditional finance may yield considerable economic benefits. After that, projects involving institutions/organizations with a stronger voice in the web 3 space may emerge with more community culture characteristics.

Project

Here is an overview of recent financing projects, intended solely for discussion from an objective perspective.

OpenTrade

OpenTrade was established at the end of 2022 and is headquartered in London, UK. Its investors include a16z CSX, Circle, Draper Dragon, CMCC Global, Ryze Labs, Polygon, and Kronos Ventures, among others. The total amount raised so far is 8.7 million USD.

Currently, four products are offered:

  1. U.S. Treasury Bond Vaults: Fixed term; fixed-rate USDC yields backed by U.S. Treasury bonds;

  2. USDC Vault: Open-ended; variable yield USDC backed by short-term U.S. Treasury bonds, money market funds, and other cash equivalents;

  3. EURC Vault: Open-ended; variable yield EURC backed by euros and short-term euro bonds, money market funds, and other cash equivalents;

  4. Rates + Vault: Fixed term; backed by investment-grade corporate bonds, commercial papers, emerging market bonds, etc.

Using Vault tokens as indicators in accounting and other operations.

USUAL - Government Bonds

Currently, it has raised a total of 8.5 million USD and is a Launchpool project of Binance.

Overall, it revolves around three types of tokens:

  1. USD0: This is a permissionless and fully compliant stablecoin backed 1:1 by real-world assets (RWA), aggregating various U.S. Treasury bond tokens.

  2. USD0++: An enhanced treasury bond, locking the principal as collateral through USD0 and using USUAL as an incentive.

  3. USUAL is its governance token.

Token economics: Total supply is 4 billion tokens, with an initial circulation ratio of 12.37%.

Image source: https://docs.usual.money/usual-products/usual-governance-token/usual-tokenomics/distribution-model

Token distribution is as follows:

Huma Finance

Currently, a total of 46.3 million USD has been raised, with the co-founder being of Chinese descent. Overall, it is a PayFi lending project. The recent round of financing includes 10 million USD in equity investment and 28 million USD in Huma platform physical asset investment. Distributed Global led the investment, with Hashkey Capital, Folius Ventures, Stellar Development Foundation, and others participating. On April 17, 2024, it will merge with Arf, focusing on tokenization of real-world assets related to PayFi.

Using Huma Points to track contributors to the protocol. Currently, it provides cross-border payment financing and credit cards supported by digital assets. It utilizes various funding pools, such as the Arf - Cross-Border Payment Financing Pool (based on USDC instant settlement, simplifying cross-border payments); Rain Receivables Pool (helping DAOs and other entities manage expenditures through wage cards); Jia Pioneer Fund Pool (providing decentralized financing for small businesses and rewarding borrowers repaying with ownership, i.e., 'Small Business Credit'), etc., to facilitate cross-border payment financing.

#RWA