The RWA market is poised for takeoff, with emerging public chains showing potential.

Real World Asset Tokenization (RWA) is a highly anticipated track that has yet to fully demonstrate its potential to connect traditional market trillion-dollar assets. Data shows that the total market value of RWA assets in the crypto industry is only $24 billion, even after a significant growth of 56% in the first half of this year. This indicates that the development of RWA is only just beginning, and as more asset classes are tokenized in the future, RWA is expected to enter a new phase of development.

In this critical period, a certain emerging public blockchain has shown strong momentum. In the past 30 days, the total value locked (TVL) of RWA on this chain has increased by 56.4%, reaching $538 million, rising to third place among public blockchains. With the participation of major DeFi protocols, RWA assets on this public blockchain may welcome more investment opportunities, positioning themselves advantageously in the next phase of competition for RWA.

Private Credit: Current Mainstream Asset Class of RWA

Private credit accounts for 58% of RWA assets, becoming the most关注ed asset class, followed by U.S. Treasury bonds. Private credit assets mainly exist in on-chain form and mostly lack trading liquidity; while U.S. Treasury bonds face competitive pressure from interest-bearing stablecoins, which are collateralized by Treasury bonds and offer similar yield characteristics.

Private credit refers to loans provided by non-bank institutions or investors to businesses or individuals in the non-public market. In traditional finance, private credit attracts a large number of institutional investors due to its flexibility and high returns. However, it also faces challenges such as high costs, low efficiency, and access restrictions. For example, the audit process for traditional private credit is cumbersome, transaction costs are high, and small to medium-sized enterprises often struggle to obtain financing due to a lack of credit history.

The encryption protocol reduces costs by eliminating multiple layers of intermediaries through the issuance and management of assets on-chain, and increases transparency by providing real-time performance of loan pools and underlying assets.

Private Credit Asset Tokenization Process

1. Off-chain credit asset generation

The asset issuer is responsible for generating off-chain credit assets. Private credit institutions, small and medium-sized enterprise financing platforms, or regional credit market operators establish loan agreements, set collateral assets, develop repayment plans and default terms, and assess the borrower's financial condition. For example, a loan of $1 million is issued to a logistics company for a term of 12 months at an annual interest rate of 12%, secured by $1.1 million in accounts receivable. This step ensures that the assets meet traditional financial standards, laying the groundwork for subsequent tokenization.

2. Build the on-chain token structure

Through the RWA protocol, single or multiple loans are mapped to on-chain tokens. The token forms include NFT, SFT, or ERC-20 types. Token metadata covers borrower anonymous identification, principal amount, interest rate, repayment frequency, maturity date, collateral asset details, and default handling mechanism. Smart contracts support repayment status management, automatic yield distribution, and early redemption or peer-to-peer transfer.

3. Compliance Packaging

The tokenization process must comply with regulatory requirements. Establish a Special Purpose Vehicle (SPV) or Virtual Asset Service Provider (VASP) as the legal custodian in specific jurisdictions, corresponding one-to-one with on-chain tokens. All investors must complete KYC/KYB and AML reviews, and non-qualified investors are restricted in access and transfer rights according to specific regulations. Off-chain disclosure documents clarify that tokens are debt assets, without voting rights or equity attributes.

4. Token Issuance and Financing

Display tokens through the user interface or protocol platform and accept on-chain investments. Investors are required to complete KYC verification, use specific cryptocurrencies for investment, obtain RWA tokens as proof, and receive repayment principal and interest on a monthly or quarterly basis.

5. Profit Distribution and Asset Settlement

The borrower repays according to the plan, and the funds are collected by the issuer and transferred to the SPV, mapped to the blockchain through an oracle or smart contract, and distributed to token holders. The smart contract automatically splits interest based on the holding ratio and automatically returns the principal or arranges for asset continuation upon loan maturity. If the token structure allows, it can be traded on decentralized exchanges or RWA-specific markets, but it usually has a lock-up period and only supports peer-to-peer transfers.

Competitive Advantages of Emerging Public Chains in the RWA Track

Technical Advantages: The Financial Application Potential of High-Performance Blockchain

A certain emerging public chain, as a new generation Layer 1 blockchain, has its technical architecture as a unique advantage in the RWA track, especially in the scenario of tokenizing private credit.

High throughput and low latency

The public chain adopts an advanced parallel execution engine, achieving efficient transaction processing through optimistic concurrency control. Official testing data shows that its theoretical throughput can reach 150,000 transactions per second (TPS), with actual stable performance in production environments between 4,000 and 5,000 TPS, far surpassing other mainstream public chains. In the private lending scenario, high throughput supports large-scale loan issuance, real-time repayment distribution, and on-chain auditing, ensuring transaction efficiency.

In addition, the final confirmation time for transactions on this public chain is only 650 milliseconds. This sub-second confirmation speed is crucial for RWA assets that require instant settlement. For example, a certain RWA protocol achieves T+0 settlement on this public chain, significantly reducing the capital occupancy cost compared to the T+2 or T+3 of traditional finance.

Low transaction costs

The transaction fees of this public chain are on average lower than $0.01. The low-cost characteristic is particularly crucial for RWA scenarios, as tokenized assets involve frequent on-chain operations. Taking a certain RWA protocol as an example, its on-chain loan management requires real-time updates of repayment status, and low fees ensure the controllability of operational costs.

Modular Architecture and Scalability

The modular design of this public chain separates the consensus, execution, and storage layers, allowing each layer to be optimized independently. This is crucial for RWA asset management as private credit involves complex metadata.

Ecological Layout: Institutional Endorsement and Regulatory Friendly

The ecological layout of this emerging public chain in the RWA track has significantly enhanced its competitiveness through cooperation with traditional financial giants and the expansion of the DeFi ecosystem.

Institutional Cooperation and Endorsement

By June 2025, the total value locked (TVL) of RWA on this public chain reached $540 million, ranking third among public chains. This achievement is attributed to the participation of several traditional financial institutions:

In July last year, the public chain introduced a stablecoin project into its ecosystem and integrated it into major DEXs and lending applications. In October last year, a well-known asset management company launched a token-represented U.S. government money market fund on the public chain. In addition, the public chain also collaborated with other institutions to promote security tokenization.

These collaborations not only brought financial and technical support but also enhanced its credibility in the field of compliance.

Regulatory Friendliness

Tokenization of private credit involves complex compliance requirements. This public chain incorporates on-chain identity verification and asset tracking functions by collaborating with compliance platforms. For example, a certain RWA protocol ensures the legal validity of loan tokens by storing personal identity information off-chain in encrypted form and combining it with on-chain hash verification.

In 2025, the global regulatory environment is becoming clearer. The MiCA regulations in Europe provide a clear framework for crypto assets, while relevant legislation in the United States creates favorable conditions for stablecoin and RWA projects. The low fees and fast confirmation characteristics of this public chain make it an ideal choice for regulatory-friendly public chains. For example, this public chain has been selected by a certain state as the top technical scoring candidate for a stablecoin project and plans to utilize it to issue compliant stablecoins and loan tokens, with an expected coverage of $100 million in assets by 2026.

Emerging Market Positioning

The RWA strategy of this public chain focuses on emerging markets, particularly in areas with insufficient financial inclusion. A certain asset issuer, as a major participant in the RWA protocol on this chain, provides diversified financing solutions for emerging markets and specific regions by tokenizing private credit products, significantly promoting the development of the RWA ecosystem on this public chain.

Its product line covers multiple areas including short-term microloans for personal consumers and small micro-entrepreneurs in emerging markets, special pools for bad debts or defaulted loans, residential property mortgages in Canada, operating loans for micro-enterprises in the UAE, and the retail credit market in Kenya. These products are efficiently issued and transparently managed through the on-chain infrastructure of the RWA protocol, contributing 77% (approximately $420 million) of the RWA TVL of the public chain.

Summary

The rapid rise of a certain emerging public chain in the RWA sector is attributed to its technological advantages and ecological layout. By June 2025, its RWA TVL reached $538 million, ranking third among public chains, primarily driven by private credit. A certain RWA protocol contributed over $420 million in assets by launching on-chain debt pools, significantly enhancing its ecological competitiveness. Private credit, as the growth engine for RWA, achieves on-chain composability through tokenization, allowing credit tokens to participate in DeFi protocols for revolving loans, leverage strategies, and liquidity pools, generating annualized returns of 6%-15%.

The low transaction fees and fast confirmation times of this public chain support real-time lending and settlement, and future integration with large DeFi protocols may further activate its potential. Currently, the tightening of interest rate spreads in traditional financial markets is prompting institutions to turn to on-chain solutions, and this public chain is filling the financing gap for small and medium-sized enterprises by serving emerging markets. In the future, with the optimization of the regulatory environment and the expansion of the DeFi ecosystem, this public chain is expected to add $500 million RWA TVL by 2026. Through the synergy of technology and ecology, this emerging public chain is demonstrating sustained growth potential in the private credit sector.