Crypto: Tokenized Finance Soars While DeFi Loses Ground

Tokenized RWA are moving against the crypto market trend. Their deposits in lending protocols and decentralized exchanges have reached $7.4 billion. At the same time, the entire DeFi sector is experiencing a contraction of about 15%.

In Brief

• Deposits of tokenized RWA have more than tripled to reach $7.4 billion.
• Overall DeFi has declined by 15%, while RWA trading has increased by 220%.
• Treasury bonds, gold, and private credit dominate this new phase of the crypto market.

RWA Rise from $2.3 to $7.4 Billion

Between the second quarter of 2025 and that of 2026, deposits of tokenized RWA have more than tripled, rising from $2.3 billion to $7.4 billion. This growth confirms the turning point in the crypto market already driven by RWA, but it only measures the assets placed in lending protocols and DEXs. It does not represent the entire capitalization of the sector.

This nuance matters. The total value of tokenized funds, stocks, and commodities on blockchains had already exceeded $40 billion. The figure of $7.4 billion indicates something else: these assets are no longer simply held in wallets. They are now being used as collateral, sources of liquidity, or borrowing support.

Tokenized funds backed by Treasury bonds dominate this new demand. Products like BlackRock's BUIDL, JTRSY, or sUSDS allow investors to continue earning a return while mobilizing their assets in decentralized finance. Private credit and certain market-neutral strategies complement this offering.

The economic logic remains simple. An investor prefers to deposit an asset that continues to generate interest rather than a capital that is completely immobilized. RWA thus reduce the opportunity cost of collateral and bring traditional yields closer to crypto infrastructures.

DeFi Declines, but Tokenized Assets Gain Utility

The contrast with the rest of DeFi is particularly stark. Total deposits in the sector have decreased by about 15% year-on-year. This decline reflects both withdrawals by investors and the drop in the price of several crypto assets. Yet, RWA continue to attract capital.

The same divergence appears in trading. Spot volumes on DEXs have fallen by about 70%, while trading of tokenized RWA has increased by nearly 220%. Gold-backed tokens, notably XAUT and PAXG, have significantly contributed to this acceleration.

Perpetual contracts are also following this trend. Activity is increasing around oil, precious metals, the S&P 500, the Nasdaq 100, and semiconductor manufacturers' stocks. The blockchain does not necessarily replace traditional markets. It rather becomes a new infrastructure for trading them continuously.

This evolution extends the growth observed when the RWA market was already approaching $35 billion. Crypto investors are now seeking less technical novelty and more understandable, liquid assets capable of generating regular returns.

Ethereum maintains a dominant position in this transformation. Nearly 70% of RWA deposits are placed in lending protocols built on its ecosystem. Solana and Plasma are also gaining ground, but the depth of Ethereum's liquidity still gives it a clear advantage.

Crypto Shifts Towards Hybrid Finance

The rise of RWA does not mean the disappearance of DeFi. It rather shows that decentralized finance is changing in composition. Purely crypto assets are losing some of their weight, while bonds, gold, private credit, and tokenized stocks are finding new uses on blockchains.

This convergence may attract more institutions. Settlements become faster, markets remain open continuously, and assets can be programmed or used as collateral. However, RWA still retain off-chain dependencies. Their value still relies on an issuer, a custodian, legal documents, and the actual existence of the represented asset.

Growth will therefore need to be accompanied by more transparency. Investors must be able to verify reserves, rights attached to tokens, repayment conditions, and counterparty risks. An efficient blockchain does not automatically correct a fragile legal structure.

The current movement resembles less a victory of RWA over DeFi than a reallocation of crypto capital. The recent contraction of stablecoins in favor of tokenized treasury products confirms this search for yield. The $7.4 billion deposited shows that tokenization is gradually moving beyond the promise stage. It is beginning to become an active layer of the financial system.