Recently, with the good performance of cryptocurrencies like CRCL and HOOD, many investors have raised several valuable questions: “If the stablecoin bill is truly passed, where will the market’s incremental growth appear?” “Why do assets like SBET and BMNR surge just by riding the wave of Ethereum’s popularity?” “Is there an opportunity for RWA in relation to Ethereum?” “Why do you all remain optimistic about ETH regardless of short-term price fluctuations?” For these different questions, we have provided fragmented answers before; this article will systematically organize and summarize them from a foundational logic and a longer-term perspective, while also serving as supplementary content to previous reports.

“The rise of ETH is not driven by the buying or promotion of one or two institutions, but rather a collective choice of mainstream institutions during a transformative layout, and the critical point of trend change is about to arrive.”

1. Starting from the data

Stablecoins have achieved a development speed that exceeds market expectations, with a total market capitalization reaching a historic high of $258.3 billion. The U.S. “Genius” bill has passed the Senate vote and is now at the House stage, led by the Republicans. Trump has called for the completion of the U.S. stablecoin legislation before the August congressional recess. Hong Kong’s “Stablecoin Regulation” has been passed and will take effect on August 1. U.S. Treasury Secretary Basent predicts that if the U.S. stablecoin bill passes, the market cap of stablecoins will rapidly grow to over $2 trillion in the coming years (over 10 times the current value). Meanwhile, asset tokenization is one of the fastest-growing markets besides stablecoins, with RWA increasing from $5.2 billion in 2023 to the current $24.3 billion, a growth rate of 460%.

Currently, the total market capitalization of traditional finance exceeds 400 trillion, the total market capitalization of the crypto market is 3.3 trillion, the total market capitalization of stablecoins is 0.25 trillion, and the total market capitalization of RWA is 0.024 trillion. According to industry forecasts from Standard Chartered Bank, Redstone, RWA.xyz, and others, by 2030-2034, 10%-30% of global assets may be tokenized, which would amount to a scale of 40-120 trillion, and the total market capitalization of RWA is expected to expand to over 1000 times its current value.

What other businesses are the most active “BlackRocks” promoting stablecoins and cryptocurrency ETFs planning?

(1) BlackRock BUIDL Fund: BUIDL (BlackRock USD Institutional Digital Liquidity Fund) is a blockchain-based tokenized dollar-pegged fund launched by BlackRock, using a tokenized form to represent underlying assets (primarily U.S. Treasury securities). Currently, the AUM has reached $2.86 billion (11.7% of the RWA market), with 95% of the funds deployed on Ethereum.

(2) Securitize: An asset tokenization company led by BlackRock and Jump, with participation from institutions such as Coinbase. In addition to issuing BUIDL with BlackRock, it has also collaborated with several traditional financial institutions to issue a variety of tokenized products: tokenizing private equity funds in partnership with Hamilton Lane; exploring the issuance of tokenized investment products in collaboration with VanEck; tokenizing part of Apollo’s private credit and alternative investment products; assisting KKR with fund tokenization. The market value of tokenized products issued through Securitize reaches $3.7 billion (15% of the RWA market), with 80% deployed on Ethereum.

(3) Franklin Templeton BENJI Fund: BENJI (BENJI Tokenized Fund) is a tokenized fund launched by Franklin Templeton that transforms traditional assets (money market funds or bonds) into digital tokens, achieving the digitization and fragmentation of assets, allowing small investors to participate, while supporting smart contract functions for income distribution or reinvestment. Currently, it has an AUM of $743 million (3% of the RWA market), with 59% of the funds deployed on Stellar and 10% deployed on ETH.

There is more traditional finance advancing the on-chain asset and asset tokenization business, and the current wave of institutional adoption represents the culmination of years of infrastructure development finally moving towards production-scale deployment.

2. Re-examining RWA

RWA (Real-World Assets) refers to the digitization and mapping of tangible or intangible assets from the real world (such as real estate, artworks, bonds, stocks, commodities, etc.) into digital tokens or assets on the blockchain through blockchain technology or tokenization methods. Broadly speaking, I believe that in the industry, RWA mainly corresponds to the on-chain and tokenization of any assets beyond blockchain-native assets, with all rights, transfer, and settlement of the underlying assets completed through the blockchain.

Tokenization has the following structural advantages:

1. Programmability - Innovation in Asset Management Driven by Smart Contracts: Programmability refers to encoding the rules, conditions, and execution logic of assets into automated and verifiable code through smart contracts on the blockchain. Tokenized assets can embed functionalities such as dividends, redemption, and staking, eliminating manual intervention. This shifts asset management from static holding to dynamic management, evolving from manual data transmission to on-chain automated updates.

2. Settlement Revolution - Efficiency Improvement and Risk Control: Tokenization enables peer-to-peer instant settlement through blockchain, replacing the lengthy T+2 clearing cycle that has plagued traditional financial systems for years. Both parties in the transaction can directly transfer ownership through tokens, eliminating the need for centralized intermediaries, thereby reducing counterparty risk and capital requirements.

3. Liquidity Revolution - The Core of Traditional Finance Embracing Crypto: Tokenization significantly enhances the liquidity of traditionally low-liquidity assets (such as real estate, private equity, etc.) by breaking them down into standardized small tokens for trading in the secondary market, combined with the gradually maturing DeFi systems. The unique 24/7 trading environment of blockchain further amplifies this effect.

“Every time an asset is put on-chain, settlement efficiency improves, and idle assets are utilized by DeFi. The faster the speed of value settlement, the higher the frequency of funds being reinvested, thus further expanding the overall economic scale. Business models will no longer rely on charging for the [流动] process, but instead create new revenue sources through the [动量] effect” (-Sumanth Neppalli). This is the core of the integration of traditional finance and crypto.

4. Global Accessibility - Breaking Down Geographical Barriers of Capital Fragmentation: Tokenization relies on the distributed nature of blockchain, allowing global investors to access tokenized assets via the internet without the need for complex cross-border intermediaries or local accounts, significantly expanding the investor base while reducing distribution costs. The global application of stablecoins is the best testament to this, and this trend is emerging in more markets such as the stock market.

Which assets are being tokenized?

1. Private Credit - The Largest RWA Tokenization Area: Contrary to most perceptions, private credit is currently the largest market for asset tokenization, with a total scale of 14.3 billion USD, accounting for 58.8% of the total RWA scale. Figure, Tradable, and Maple are respectively providing 10.6 billion, 2 billion, and 800 million in active loans.

2. Government Bonds - The Starting Point for Tokenization by Traditional Institutions: The market size of tokenized government bonds has reached $7.4 billion, accounting for 30% of the total RWA size, with notable examples being BlackRock’s BUIDL; Franklin Templeton’s BENJI; Superstate’s USTB; and Ondo Finance’s USDY. Traditional financial institutions are exploring the development of on-chain derivative financial products and the integration with DeFi based on tokenized government bond products.

3. The tokenization of the stock market is accelerating: On June 30, cryptocurrency exchanges Kraken and Bybit announced the launch of tokenized U.S. stocks and ETFs through xStocks, enabling 5*24 hour trading. Although these are not blockchain-native stocks, they allow participation in arbitrage trading through stock tokenization, breaking the geographical boundaries of the U.S. stock market. Meanwhile, Robinhood announced that it is building the “Robinhood Chain” on the Arbitrum blockchain, aimed at supporting decentralized management of future asset ownership. This marks its transformation from a traditional broker to a blockchain-native platform, dividing stock tokenization into three phases to integrate blockchain for composability advantages. At the same time, Coinbase has positioned tokenized stocks as a “top priority,” with its Chief Legal Officer Paul Grewal actively seeking approval from the U.S. Securities and Exchange Commission (SEC) to offer blockchain-based stock trading services, leveraging its Base Layer 2 network as a potential infrastructure for future tokenized stock settlement. This year, we may witness these leaders launch popular stocks native to the blockchain.

4. Commodity tokenization mainly based on gold: Gold accounts for almost 100% of tokenized commodities. Paxos Gold (PAXG) leads with a market capitalization of approximately $850 million.

5. Active exploration of private equity tokenization: Private equity is the ultimate goal of tokenization, and this technology can solve structural problems that have persisted for decades, changing the extremely poor liquidity of traditional private equity.

3. Stablecoin - RWA - DeFi

Stablecoins are the most important underlying foundation for the integration of traditional finance into the blockchain. They make currency programmable and decentralized, serving as the basis for the circulation and settlement of all on-chain financial assets. In an interview, Dr. Xiao Feng, Chairman of Hashkey Group, shared insights from Professor Meng Yan, stating that “the U.S. presidential team and Congress are relatively frank and transparent about the motivations behind stablecoin legislation. First, it is to modernize the U.S. payment and financial system; second, to strengthen and enhance the position of the U.S. dollar, creating trillions of dollars in demand for U.S. Treasury bonds over the next few years.” He also noted that “Bitcoin as a national reserve is second for the U.S., while dollar stablecoins are first, representing America’s core interests.”

The rapid development of RWA in this round is attributed to institutions’ compliance continuously exploring new ways of integration, and promoting the legislation of digital asset market structure bills. Once the stablecoin and market structure bill legislations are completed, a large number of assets will be quickly pushed on-chain, with transactions, revenues, settlements, and other processes operating on the native blockchain, using stablecoins as the base currency unit and value carrier.

Once a large amount of assets are on-chain, DeFi will begin to take effect, integrating newly on-chain assets with increasingly mature DeFi protocols to achieve efficiency, automation, and compliance. This will promote the creation of derivatives and the generation and distribution of high liquidity yields. This period may represent a new wave of vigorous development opportunities for the entire DeFi ecosystem since DeFi Summer.

The case of RWA and DeFi integration

1. Securitize connects DeFi systems through sTokens:

Securitize, the world’s largest tokenized asset issuer, does not support the direct use of its native tokenized securities in DeFi protocols due to compliance considerations. Tokens must first be deposited into sVault, where they are minted into DeFi-compatible versions called sTokens, which can then be integrated into the existing DeFi ecosystem.

BlackRock BUIDL and the Euler Protocol: Securitize’s sBUIDL (a derivative token of BUIDL) has been integrated with the Euler lending protocol on Avalanche. Holders can deposit sBUIDL into the sToken Vault to borrow other assets while continuing to earn daily returns from BUIDL.

Apollo ACRED and Morpho Protocol: The sToken version of ACRED (sACRED) runs on Polygon PoS through Morpho, allowing holders to use sACRED as collateral to borrow USDC, with automatic reinvestment to amplify returns.

2. Ethena’s USDtb fusion BUIDL achieves a stable return floor.

The Ethena Risk Committee approved the use of USDtb as the primary supporting asset when the Delta neutral financing strategy reaches a local minimum. 90% of USDtb reserves are held in BlackRock’s BUIDL fund, serving a dual purpose: providing low-risk collateral for margin trading on centralized exchanges and offering compliant treasury exposure in adverse financing environments.

“The addition of USDe to support USDtb has indirectly catalyzed the explosive growth of complex DeFi yield strategies, particularly facilitating the robust money market for Pendle’s principal tokens (PT) and yield tokens (YT) — traditional finance views these tools as interest rate markets. During periods when crypto derivatives financing rates turn negative or compress significantly, USDtb support provides crucial yield floor stability (typically at an annual interest rate of 4–5%). This predictable minimum yield base is essential for PT token valuation and AAVE’s oracle system, which can provide more accurate pricing models and safer liquidation mechanisms for zero-coupon bond mechanisms.”

Currently, traditional financial institutions are starting to explore the development of on-chain derivative financial products and the compliance integration of DeFi based on tokenized government bond products, starting from stablecoins.

4. ETH is currently the mainstream choice for institutions.

According to current data, ETH remains the primary public chain for institutions to tokenize assets, with a tokenized market value of 7.5 billion USD on ETH, accounting for 58.41% of the total scale. The tokenized market value on ETH’s L2 ZKsync Era is 2.245 billion USD, accounting for 17.47%. Among other public chains, Aptos ranks first with a tokenized market value of 540 million USD, accounting for approximately 4.23%.

Thinking from the underlying logic, there are three main reasons why institutions prefer ETH as the primary platform for asset on-chainization:

1. Ethereum has the highest security among all public chains currently. It has accumulated a ten-year security record without any serious issues such as downtime. When Ethereum upgraded from PoW to PoS, its ability to complete the core architecture upgrade without downtime was described as “changing the engine while the plane is flying.” The stability demonstrated by its excellent technical foundation and organizational integration capabilities aligns with the prudent principles of institutions making new business arrangements.

2. It has the most mature DeFi ecosystem and the best liquidity, as well as the most mature DeFi protocols. The most innovative product mechanisms mostly exist on Ethereum. After institutions go on-chain with ETH, they can quickly access the mature DeFi system and enjoy the best liquidity.

3. Extremely high decentralization and global business reach also serve as a balance center for the interests of large institutions and global investments. One of the reasons why stablecoins hold such strategic importance for the United States is that they achieve decentralized global reach on-chain, breaking down the past political divisions of national currency barriers, and pushing dollar equivalents out to the world through the network. Asset tokenization is similar; for example, recent tokenization of U.S. stocks allows those who previously could not invest in U.S. stocks to bypass national entry restrictions and participate in U.S. stocks on-chain. ETH, benefiting from the best liquidity and influence, is the preferred public chain for global business reach, and due to its decentralized nature, it serves as a balance center for the interests of large institutions and global investors. Sovereign nations’ large institutions would not be willing to choose a public chain that is completely dominated and controlled by another country to issue products and participate in large financial activities.

Let’s see how Etherealize says it.

EF has undergone significant functional differentiation and specialization, reorganizing into three major business groups while separating specific functions to external organizations, leading to the birth of Etherealize. It is positioned as the “institutional marketing and product pillar” of the Ethereum ecosystem, focusing on connecting with traditional finance and Wall Street to accelerate Ethereum’s adoption among institutions.

Etherealize believes that ETH should not be evaluated as a tech stock, but rather as a new category of asset: ETH is digital oil — an asset that powers, secures, and reserves the new financial system of the internet.

“The traditional financial system is at the beginning of a structural transformation from analog infrastructure to digital-native architecture. Ethereum is expected to become the foundational software layer — similar to an operating system like Microsoft Windows — on which the new global financial system will be built.”

When all of this is realized, ETH will become the foundational asset of a comprehensive global platform that will cover the future of finance, tokenization, identity, computing, artificial intelligence, and other fields. This inherent complexity makes it more difficult to define ETH, especially in comparison to simple value storage assets like Bitcoin — — but it also makes ETH strategically more valuable and signifies that ETH has greater long-term potential.

At the same time, ETH is not just a cryptocurrency; it is a multifunctional asset whose roles include: computational fuel; value storage asset with ancillary returns; original settlement collateral; deflationary asset; embodiment of tokenized economic growth: reserve trading pairs: strategic reserve asset.

Therefore, ETH cannot be accurately valued using the discounted cash flow method. Instead, ETH must be viewed from the perspective of strategic value storage and utility-driven scarcity. ETH powers the digital economy, secures the digital economy, captures value from the growth of the digital economy, and has inherent scarcity due to its supply dynamics and issuance cap. As the global economy transitions to tokenized infrastructure, ETH will become indispensable, not just as fuel, but as the native asset of the future financial system’s currency and settlement layer.

Why is ETH lagging behind BTC?

The answer is simple: the narrative of Bitcoin has been accepted by institutions, while the narrative of Ethereum has not. In contrast, Ethereum’s value proposition is harder to define — not because it is weaker, but because it is broader. Bitcoin is a single-purpose value storage asset, while Ethereum is a programmable foundation that supports the entire tokenized economy.

The process of accelerating the repricing of ETH is underway:

1. Surge in Demand: Institutions have begun to rapidly adopt and deploy tokenized assets and financial infrastructure on Ethereum at a large scale, as evidenced by the data in this article.
2. The demand for native crypto yields is accelerating: with the trend of institutions building on ETH on a large scale, the launch of Ethereum ETF staking is just a matter of time. The emergence of a physical subscription/redemption model for institutions will also significantly increase their interest in ETH staking yields.
3. Strategic accumulation of ETH: A competition is emerging within the Ethereum ecosystem to hoard ETH as a premium value storage asset. Recently, the U.S. publicly traded company Bitmine Immersion Technologies raised $250 million to launch its ETH financial strategy, driving its stock price from $4 to a peak of $74 in two days, an increase of over 180%.
4. ETH as an institutional funding asset: The unique characteristics of ETH — original collateral, neutrality, yield, and global utility — make it the preferred reserve asset for institutions and globally.

In summary, ETH is not the only long-term choice for institutions entering the blockchain, but it is currently the optimal solution for large-scale asset tokenization. Considering the data, examples, underlying logic, and recent Big News, the trend of ETH being revalued is on the horizon.

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