“Emerging markets also tend to ‘leapfrog’ infrastructure that holds back developed markets, adopting digital rails, including stablecoin settlement, faster than markets with entrenched legacy plumbing,” he added.
The tokenized real-world asset (RWA) market is expected to expand further in 2026, driven largely by adoption in emerging market economies, according to Jesse Knutson, Head of Operations at crypto exchange, BitFinex.
Knutson said that emerging markets – which often lack deeply entrenched financial market infrastructure – are likely to embrace tokenized real-world assets before developed countries.
Tokenization of real-world assets refers to the process of representing physical or traditional assets on blockchain networks. By enabling on-chain capital formation and bypassing traditional financial intermediaries, tokenization can reduce the ‘friction’ these markets face when raising capital or attracting foreign investment, Knutson said.
“Emerging markets also tend to ‘leapfrog’ infrastructure that holds back developed markets, adopting digital rails, including stablecoin settlement, faster than markets with entrenched legacy plumbing,” he added.
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Knutson noted that tokenization also enables fractional ownership of assets, making investments accessible to a broader range of investors who might otherwise be priced out.
He said companies able to offer fixed returns but unable to secure traditional financing stand to benefit most from tokenization. In developed economies, fixed-income instruments such as U.S. Treasuries and money market funds are the most commonly tokenized assets, whereas real estate and commodities dominate tokenization use cases in developing economies.
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Knutson predicts that the total market capitalization of tokenized RWAs could swell to several trillion dollars over the next decade – but this growth depends on major issuers moving beyond pilot programs and test environments to full-scale commercial products.
Despite a positive outlook, several obstacles to mainstream adoption persist. According to Knutson, these include:
He also highlighted the need for uniform interoperability standards across different blockchain networks and platforms issuing tokenized assets. Differences in token standards and disparities between permissioned blockchains and permissionless ecosystems pose technical challenges for RWA issuers.
Issuers must develop tokenized products that can be transferred across the broader crypto ecosystem and used as collateral in decentralized finance (DeFi) applications to unlock the full potential of on-chain assets.
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Stay tuned to BitKE Updates on RWA developments in Emerging Markets like Africa
