RWA tokens and broader crypto market surge, buoyed by favorable macroeconomic conditions and major institutional developments in asset tokenization
TL;DR…
- RWA tokens surge: Top 20 RWA tokens all in the green, with Ondo, VeChain, and Synthetix posting double-digit gains.
- Macro boost: Fed rate cut, Harris crypto stance, bullish seasonality and a weakening DXY fuel market growth.
- Major RWA news: Visa, Cardano, INX, and Securitize - all expanding RWA tokenization and marketplace innovations.
- Chainlink co-founder bullish on RWAs: Sergey Nazarov predicts RWAs will surpass total crypto market value, requiring 2,000% growth.
In the last week, the crypto market as a whole demonstrated a remarkable recovery — much to the dismay of sidelined investors.
Bitcoin (BTC) blasted through the $64k barrier, Ethereum (ETH) retook $2,600 and the RWA market leader Ondo (ONDO) smashed the already impressive broader market returns.
Now, the market looks to be gearing up for a particularly bullish fourth quarter. Let’s dive in and find out why.Did you miss last week’s update? Check it out here.
RWA Market Update
Things are shaping up well in the RWA space from a price action perspective.
The top 20 largest RWA tokens by market capitalization are all in the green over the last 7 days with some dramatically exceeding the market average.
In terms of 7-day price action, Ondo (ONDO), VeChain (VET) and Synthetix (SNX) lead the top 10, with the tokens posting a 21.4%, 14.3% and 14.1% gain respectively. This trend has also been observed in the last 24 hours, with most RWA tokens performing well in the last day.
Source: Top RWA Tokens Page
Meanwhile, Maker (MKR) continues its relatively muted performance — up just 1.9% for the week.>>> For comparison, the average cryptocurrency has gained just 2% in the last 7 days.
Much of this growth appears to be directly tied to four primary macro events:
1. Last week’s Fed rate cut: a 50 bps rate cut supercharged the market and sent both traditional and crypto assets soaring. The possibility of further rate cuts in 2024 is likely being priced in.
2. Kamala Harris reveals crypto stance: The currently leading 2024 Presidential candidate Kamala Harris pledged to make the US “dominant in blockchain”. Now, both leading candidates have expressed plans to boost the crypto economy.
3. Seasonality enters bullish period: Q4 has historically proven to be the most profitable quarter for crypto assets, with Bitcoin netting an average of 88.8% and Ethereum pulling in an average of 23.3% in the last 3 months of the year.
4. Weakening of the dollar index (DXY): The dollar has lost its long-term uptrend, as the DXY has fallen to nearly its lowest value in over a year at 100.9.
Despite its impressive performance, the RWA sector is only at the middle of the pack when it comes to returns. Instead, artificial intelligence (AI), data availability layers and analytics tokens have seen better mcap-weighted performance over the last week.
Source: DeFiLlama
Weekly News Roundup
The last week has been packed with major updates and developments in the RWA space. We’ve collected the most significant stories below to help you catch up quickly.
Visa to deploy RWA tokenization platform on Ethereum: In 2025, Visa will launch its asset tokenization platform known as VTap on the Ethereum blockchain, allowing institutions to test tokenized fiat currencies, commodities and other tokenized assets on-chain.
Cardano gets its first gold-backed token: Kinka Gold is launching the Kinka Token (XNK) on the Cardano blockchain with support from Cardano founding entity EMURGO.
Plume Network to tokenize $1.25 billion in RWA: RWA-focused modular blockchain, Plume Network, aims to tokenize over $1.25 billion in real world assets in Q4 2024 — including solar farms, mineral rights and private claims
INX and Backed expand RWA marketplace to non-US investors: Eligible participants outside the US will now be able to trade various stocks tokenized on the Polygon blockchain. INX is also set to add multiple tokenized ETFs by early October.
Polygon gets secondary tokenized RWA market: Europe's first blockchain-based regulated RWA market will be deployed on Polygon — allowing retail and institutional users to trade tokenized RWAs on chain.
Securitize joins forces with Wormhole for cross-chain RWA: Securitize has selected Wormhole as the interoperability provider for its tokenized assets, allowing users to move its tokenized products seamlessly between blockchain platforms.
What to Expect in Q4
Chainlink co-founder Sergey Nazarov is known to be a vocal proponent of RWA tokenization and has regularly heralded the industry as a sleeping giant just waiting to wake up.
In a recent speech at the TOKEN2049 conference in Singapore, Nazarov elaborated on his view by predicting that RWAs will "overcome the total value of cryptocurrencies."To put this into perspective, Binance Research recently found that on-chain RWAs currently exceed $12 billion in market value. For comparison, the total crypto market market cap stands at $2.35 trillion.
This means RWAs would need to achieve more than 2,000% growth at current ratios to actualize this prediction.
Meanwhile, well-known asset management firm and Bitcoin spot ETF provider, VanEck, recently predicted that Bitcoin would grow regardless of whether Trump or Harris wins the presidency.
In its recent report, VanEck suggests that a Trump presidency might be better for the broader crypto landscape, whereas a Harris presidency might mostly benefit Bitcoin.Moreover, PayPal just enabled US businesses to buy, sell and trade cryptocurrencies and FTX payouts are expected to be distributed by the end of the year.
With these, a fresh wave of capital could be injected into the market, boding well for sectors with a lot of mindshare — like RWAs.
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