For years, crypto has thrived on speculative capital flows and the explosive popularity of decentralized finance (DeFi) tokens and applications. That still holds true for rising sectors such as perpetual decentralized exchanges and prediction markets. But as Wall Street pushes deeper into tokenized real-world assets (RWAs), not all of the industry’s existing systems cater to the kinds of financial products institutions want to bring onchain.
An author of the newly finalized ERC-7943 (uRWA) token standard said that the fragmented infrastructure powering much of DeFi wasn’t designed for regulated financial assets, which often require identity frameworks and interoperability standards.
“If you want to bring regulated assets onchain, you can’t really escape regulations,” Dario Lo Buglio, co-founder and head of blockchain at tokenization platform Brickken, told Cointelegraph. “You can still play your pirate game on DeFi without regulated assets.”
Existing standards don’t cover every RWA use case
Another token standard, the ERC-3643 — also known as the T-REX or Token for Regulated Exchanges — is one of the dominant frameworks used for tokenized securities on Ethereum. The standard already includes many of the compliance-oriented features institutions require, like identity-based permissions and mechanisms that allow issuers to intervene under specific circumstances.
However, the framework was designed primarily around securities and does not necessarily translate across the broader range of tokenized assets now entering blockchain markets, Lo Buglio said. Interoperability is increasingly difficult as more institutions experiment with bringing traditional financial products onchain.
“As tokenization becomes easier, the harder problem is making those assets work across different compliance systems, custodians, exchanges, wallets and institutional platforms,” Markus Levin, co-founder of XYO, told Cointelegraph.
Levin said standards such as uRWA could help standardize how tokenized assets carry information tied to identity, permissions, compliance requirements and transfer rules across Ethereum-based systems. “Done well, that makes regulated assets far easier to move, verify and integrate without every institution building its own isolated infrastructure,” he said.
Tokenized RWAs grew from roughly $6.4 billion at the start of 2025 to about $34 billion as of Thursday, according to RWA.xyz data. Standard Chartered estimates this value could reach $2 trillion by the end of 2028, while the Boston Consulting Group projects $18.9 trillion by 2033. In measurements that classify stablecoins as RWAs, the total market capitalization is approaching $340 billion.
Levin added that institutions have largely prioritized assets with predictable cash flows, real yield and established legal structures. “The market is tokenizing what benefits most from faster settlement, programmable collateral and lower operational friction,” he said.
Privacy as the next institutional requirement
Privacy remains another major obstacle for institutions experimenting with onchain finance, particularly for firms unwilling to expose portfolio activity or transaction flows on public blockchains.
Source: ERC-7943 Co-Author: Regulated Assets Need New DeFi Infrastructure