Skip to main content

What Is the “Liquidity Problem” That RWA Tokenization Attempts to Solve?

The "liquidity problem" that Real-World Asset (RWA) tokenization attempts to solve is the illiquidity and high transaction costs associated with traditional assets like real estate, private equity, and fine art. By tokenizing these assets, they are converted into fractional, divisible, and easily transferable digital securities on a blockchain.

This allows for 24/7 trading, immediate settlement, and a broader investor base, significantly enhancing their liquidity and reducing the time and cost required for transactions.

What Is Fractional Ownership and How Does Blockchain Enable It?
Explain the Concept of “Tokenizing” a Real-World Asset (RWA) Using an NFT Standard
What Are the Regulatory Challenges of Tokenizing Real Estate?
How Does the Legal Framework Treat Fractional Ownership of Digital Assets?