When it comes to Real World Assets (RWA), tokenization is often the first thing that comes to mind. However, while tokenization is essential, it tends to overshadow the core nature of RWA, which is corporate finance and institutional markets. The core of RWA exchange’s tokenization is crypto corporate finance.
Many people ask whether their assets can be part of an RWA project. However, RWA involves more than just the assets themselves – it also includes various elements such as funding, market participants, and liquidity. The feasibility of RWA issuance varies depending on who holds the assets, whether it’s individual investors, institutional funds, core enterprises, or arbitrage funds.
The perception of RWA’s tokenization can be misleading. The conservative approach to RWA is to prioritize financial products before tokenization, which is a necessary compromise in the early stages. Tokenization is a means to an end, but it’s not the essence. The essence lies in enterprise finance and institutional markets.
To illustrate this, it’s important to consider different approaches to RWA’s tokenization. For example, under the name of “Enterprise Finance Business Group,” the main purpose is to facilitate enterprise finance. Similarly, the “Industrial Investment Banking Business Group” focuses on trade and supply chain finance, extending to the integration of resources, funds, and capital within an industry’s value chain. The “Investment and Wealth Management Business Group” deals with crypto asset investment, fixed income, insurance, and other RWA wealth management products.
While RWA products can appear cutting-edge and aligned with Web3.0, RWA exchanges must also appeal to traditional enterprises and investors. The goal is to attract more participants and expand the asset pool. As more mid-sized enterprises join the industry, larger enterprises are more likely to follow suit. RWA could potentially become a digital IPO for industries when traditional IPOs are becoming increasingly difficult.
The development of the RWA market requires specialized institutions, especially professional advisory and research institutions that can provide consulting and financial advice for enterprises seeking crypto financing. RWA’s ecosystem also requires down-to-earth channels and agents, just like those seen in the cryptocurrency industry, but with a focus on professional institutions and financial advisors for enterprise clients.
From the perspective of corporate finance, RWA’s tokenization can be divided into different directions, including digital bonds, digital IPOs, digital REITs, and innovative non-equity and non-debt products. Each of these serves different purposes within the enterprise finance spectrum.
In terms of financing, RWA issuance requires careful consideration of global investment trends and regional monetary systems. While Middle Eastern funds may seem favorable to RWA, differences in economic structure might not make them an ideal match. European and American funds, on the other hand, may show potential for reinvestment. Therefore, RWA must adhere to the principle of finding the best match for its assets.
In summary, RWA’s tokenization and the development of its ecosystem require a deep understanding of corporate finance, investment trends, assets, and channels. It also necessitates a balance between traditional financial services and innovative approaches, combining the best of both worlds to create a thriving RWA market.
