Key Features and Benefits

Fractional Ownership & Lower Entry Barrier — Because a physical asset can be divided into many digital tokens, investors no longer need to buy entire properties or artworks. Smaller capital outlays can grant exposure to high-value assets. RWApedia+2Encyclopedia Britannica+2

• Enhanced Liquidity — Assets that are typically illiquid (e.g. real estate, private debt) become tradable on blockchain-based marketplaces, possibly 24/7, enabling easier buying and selling. Chainlink+2Cointelegraph+2

  
  

• Global Accessibility & Inclusion — Tokenized RWAs lower geographic, economic, and institutional barriers. Anyone with crypto access and compliant know-your-customer (KYC) may potentially invest. Encyclopedia Britannica+2Outlook India+2

  
  

• Transparency & Auditability — Because ownership and transaction history are recorded on a blockchain, token holders (and auditors) can verify provenance and compliance, reducing the risk of fraud. securitytokenizer.io+2Cointelegraph+2

  
  

• Efficiency & Reduced Costs — Smart contracts can automate many administrative functions (transfer, distribution, compliance), cutting the role of intermediaries, lowering fees, and accelerating settlement. chainterms.com+24ire+2

  
  

Risks and Challenges

However — as with any innovation — there are trade-offs and caveats:

• Regulatory & Legal Uncertainty — Many jurisdictions are still adapting laws to tokenization. The legal status of tokenized assets may vary, and regulatory changes can impact operations. Encyclopedia Britannica+24ire+2

• Liquidity Gaps — While tokenization enables tradability, real market liquidity depends on actual demand. Some tokenized assets remain thinly traded. 4ire+1

• Custody & Governance Risks — Off-chain real assets still need secure custody. Improper asset management, opaque structures, or weak compliance can undermine token value. securitytokenizer.io+1

• Valuation & Transparency of Underlying Assets — Regular and credible valuations, audits, and transparent reporting are essential; without them, the “digital twin” may have limited trust or credibility. Encyclopedia Britannica+2blog.huma.finance+2

  
  

Why RWAs Are Gaining Attention

As decentralized-finance (DeFi) and traditional finance (TradFi) converge, RWAs present a bridge between the real economy and blockchain infrastructure. They offer a way to bring tangible value — not just speculative tokens — into the crypto ecosystem. Chainlink+2Wikipedia+2

For investors, RWAs represent diversification — a way to access real estate, private credit, commodities, or other real-world assets with smaller amounts, global reach, and blockchain-level transparency.