What Is Real-World Asset Tokenization?

[Chawla Solutions]

Real-world asset (RWA) tokenization is the process of converting tangible assets—such as real estate, stocks, bonds, gold, or even art—into digital tokens on a blockchain. These tokens represent fractional ownership and can be traded, transferred, or used within DeFi ecosystems.

How it works:
A real-world asset is legally and digitally represented on-chain. Each token corresponds to a share of the physical asset, and ownership is recorded transparently on the blockchain. Smart contracts automate transactions, rights, and revenue distribution.

Key benefits:

• Accessibility: Tokenization lowers the barrier to entry. Instead of buying a $200,000 property, users can purchase a $200 fraction.

• Liquidity: Tokenized assets can be traded 24/7, often on decentralized platforms, unlike traditional markets that close on weekends.

• Transparency: Every transaction is recorded immutably on-chain, offering trust without centralized oversight.

• Efficiency: Reduced need for middlemen means faster settlement, lower fees, and streamlined compliance.

Real examples:

• RealT: Offers tokenized rental properties in the U.S., with real-time rental income paid in crypto.

• Ondo Finance: Specializes in tokenized U.S. Treasuries and bonds, bridging traditional finance and DeFi.

Why it matters:
Tokenization unlocks a borderless, permissionless economy where anyone can invest in high-value assets with just a crypto wallet. It blends the trust of traditional assets with the flexibility of blockchain.