Platforms & Protocols Leading the Tokenization of Real World Assets

Tokenization is transforming the representation, transfer, and management of assets across digital networks. It enables physical and traditional financial assets to be digitized, creating new ways to trade them with fewer restrictions and intermediaries. Various platforms and protocols are driving this change, each providing infrastructure to make the process more accessible, secure, and transparent.

Utilizing blockchain for asset representation reduces paperwork, lowers costs, and streamlines transactions. Smart contracts enable rules to be programmed directly into tokens, facilitating the enforcement of ownership rights and automating transfers. This provides both investors and institutions with greater control and flexibility over their interactions with various asset types.

In this article, we will look at some platforms and protocols that are leading the tokenization of real-world assets.

Growth in Asset Tokenization

The idea of turning assets into blockchain-based tokens is not new, but it's now gaining traction across broader markets. Tokenization is no longer limited to cryptocurrencies or digital collectibles. A growing number of financial instruments, including bonds, private equity, and real estate, are being prepared for token-based trading.

According to McKinsey & Company, the concept of tokenizing assets is now gaining momentum. Although it is not yet mainstream, financial institutions with blockchain capabilities can make the most of this opportunity. The first at-scale applications are already transacting assets worth trillions of dollars every month.

Much of this growth is linked to how certain platforms handle real-world assets. These are assets that exist outside of the digital space and have long been part of traditional finance.

According to Polymesh, examples include commercial buildings, farmland, corporate debt, and rare physical items. Bringing them onto blockchain networks allows for fractional ownership, broader investor participation, and more efficient settlement processes.

The challenge lies in ensuring that each token accurately reflects its underlying asset. This involves legal agreements, custodial services, and often close coordination with regulators.

Since real-world assets are governed by local laws, platforms operating in this area must strike a balance between innovation and compliance. It's not just about creating tokens; it's about connecting those tokens to real, verifiable assets in a reliable way.

Leading Platforms in the Space

Here are some of the leading platforms accelerating real-world asset adoption:

Polymesh

Polymesh is a purpose-built blockchain designed specifically for regulated asset tokenization. Unlike general-purpose blockchains, Polymesh focuses on identity, compliance, confidentiality, and governance from the protocol level. These features make it suitable for security tokens and other asset classes that require strict regulatory oversight.

Issuers can manage compliance rules directly on-chain, and investors must be verified before participating in any transaction. Polymesh has also partnered with platforms like NayaOne Network to make blockchain technology more accessible. This partnership is expected to improve efficiency, reduce costs, and increase liquidity.

Polygon

Polygon offers a scalable framework for tokenization. Its compatibility with Ethereum makes it popular among developers and projects focused on asset-backed tokens. Real estate initiatives have utilized Polygon to create tokens representing property shares, facilitating faster transactions and improved access for smaller investors.

Ondu's OUSG token is a prime example of tokenized treasuries on Polygon. The token's on-chain products have accrued $134 million of assets under management through Ethereum. According to CoinDesk, Ondo Finance already offered its tokenized US Treasuries on Ethereum but also expanded to the Polygon network.

Ethereum

As the most widely used smart contract platform, Ethereum remains a preferred option for tokenizing a wide range of assets. It supports complex logic, integrates with DeFi protocols, and is home to significant tokenization efforts like Centrifuge. Centrifuge focuses on bringing off-chain financial assets into blockchain-based lending systems.

Ethereum is popular due to its complex, multi-layered security for smart contracts. Optimism, one of the blockchain layers on Ethereum, is the most widely used for deploying these contracts. A Blockworks article shows that over two-thirds of Ethereum Virtual Machine (EVM) smart contracts are deployed on Optimism.

Avalanche

Avalanche is known for its custom subnets that allow institutional-grade control over compliance and access. It has been used in tokenizing assets such as treasury securities and private investment funds.

The platform has also taken several initiatives to accelerate the adoption of real-world assets. One of the recent initiatives was Avalanche Vista, which expanded the use of tokenization for creating quick and secure real-world assets. According to Crypto Briefing, it also committed around $50 million to this initiative.

Protocols Built for Asset Tokenization

There are many protocols built for asset tokenization, such as:

• Centrifuge: Centrifuge is designed to bring real-world financial documents, such as invoices and trade receivables, into the decentralized finance (DeFi) ecosystem. Businesses can use these tokenized assets as collateral to access liquidity, blending traditional finance with decentralized protocols.
• RealT: It offers a straightforward way to invest in U.S. rental properties by issuing tokens that represent property ownership. Rental income is distributed directly to token holders, showing how blockchain can streamline property investment and management.
• Maple Finance: Maple Finance operates as a decentralized credit marketplace. It allows businesses to raise capital through undercollateralized loans, using on-chain systems to manage loan terms. It relies on off-chain financial assessments for risk evaluation.
• Tokeny: It provides the tools necessary for issuing digital securities that adhere to established legal frameworks. It supports functions such as investor verification, compliance checks, and asset custody, which are essential for platforms that aim to serve regulated markets.

Key Considerations for Success

A successful tokenization platform needs to do more than mint tokens. It must ensure that those tokens represent something reliable, enforceable, and compliant with local regulations. This includes legal agreements, clear ownership rights, and proper reporting mechanisms.

Platforms that enable the digital access, trading, and management of real-world assets are presenting new opportunities for both retail and institutional investors. They're not replacing traditional finance but offering ways to expand access, improve efficiency, and remove outdated barriers.

Frequently Asked Questions

1. Can individual investors participate in tokenized real-world assets, or is it limited to institutions?

Yes, individual investors can participate, but access depends on the platform and the type of asset. Some platforms offer fractional ownership, making it possible to invest small amounts. However, regulatory restrictions may apply, and certain investments are only available to accredited investors.

2. How are fees handled when trading tokenized assets?

Fees vary by platform and transaction type. Typical costs include network (gas) fees, platform service fees, and legal or compliance-related charges. Some platforms also charge for onboarding, custody, or secondary market trading. Always check a platform's fee structure before investing.

3. What happens if the platform managing the tokenized asset shuts down?

This depends on the asset's legal structure. If the token is legally linked to the underlying asset through a custodial or trustee agreement, the investor may still retain their rights. Some platforms utilize smart contracts and third-party custodians to separate asset management from platform operations, thereby reducing this risk.

Tokenization is evolving quickly, with more projects moving from experimental phases to real-world adoption. As the infrastructure improves and regulatory support becomes clearer, more asset classes are expected to follow. Platforms that combine solid technical foundations with legal and financial transparency will likely lead the way forward.