Do you see the opportunity of RWA clearly?

According to data from Dune Analytics, RWA has become the only crypto narrative that has experienced growth in the past 3 months except meme. In an environment where the market as a whole is stagnant, this performance caught our attention. In fact, there has been buzz about RWA since June last year, and the narrative was completely ignited after BlackRock launched the BUIDL on-chain fund.

In the encryption field, RWA is already a "badly told story". Although RWA is a new concept, connecting and influencing real industries in a decentralized manner seems to have always been the "intuitive direction" of entrepreneurs in the cryptocurrency industry: Blockchain, like the Internet, will definitely revolutionize traditional business. However, getting everything on the chain is not as simple as everyone imagines, from the on-chain gold of Paxos Gold in the early years to the on-chain energy ledger of Power Ledger during the ICO period, to the on-chain credit Maple Finance and Goldfinch, RWA with luxurious backgrounds in the previous cycle. It seems to keep failing.

But what’s interesting is that native users of the crypto industry seem to have been underestimating the vitality of this narrative. Through a detailed combing of time clues, we can clearly see the continuous changes in the fundamentals of RWA’s narrative. Behind this narrative renaissance is the alignment of RWA’s product positioning and user needs, as well as the huge increase driven by traditional financial institutions. Chance.

In front of the wind, everyone has a good sense of smell, but not many people can really "step on the right spot". In the past six months, countless teams have gathered to transform RWA, but only a few projects have successfully seized the opportunity and achieved initial results. Whether it is transformation or entry, seeing opportunities clearly is the key for a team to get a ticket. Among the many competitors, a project called Jiritsu attracted our attention.

Always fail RWA

On December 6, 2022, smart contract audit platform Sherlock updated a blog post on Mirror to inform the community team that it will suffer a loss of approximately $4 million due to the default of Maple Finance borrowers. Prior to this, Sherlock had approximately 5 million USDC stored in the Maple lending pool managed by M11 Credit. However, now, the overall fund loss of the pool's stakers will exceed 30%. On the same day, DeFi insurance platform Nexus Mutual also predicted that it would lose approximately $3 million in the Orthogonal Trading default event.

The day before, crypto hedge fund and credit investment firm Orthogonal Trading defaulted on a $36 million loan on Maple Finance, accounting for approximately 30% of Maple Finance’s active loan volume. Just half a year ago, Maple had just suffered a loan default of nearly 10 million US dollars from Babel Finance, and it was Orthogonal Trading’s 10 million USDC position in the loan pool that was hit hard.

In one year, a series of defaults have made the former RWA lending star miserable. After the LUNA and 3AC crashes, the chain reaction in the crypto market rapidly intensified. The liquidation of mainstream ecology and institutions caused the overall credit scale of the market to shrink rapidly, leading to the continued occurrence of deleveraging events. After the FTX crash, active loans in the market The total value plummeted by 80%, shrinking from US$1.58 billion to US$270 million in early 2023. Maple had a tough time as the market tanked, with defaults continuing to happen even after tightening lending standards was announced in October.

Many people blame the market for Maple's setback, thinking that Maple was born at the wrong time. But even as markets recover, defaults are occurring frequently on many RWA lending agreements. In April, startup credit firm Lend East said only about $4 million of a roughly $10 million loan it had previously secured through RWA lending agreement Goldfinch would be repaid, with the remaining $6 million in full default. Since it began operations, Goldfinch has suffered three major defaults. This project, which was born with a golden key, also failed to bring magic to RWA.

From June 2021 to January 2022, a16z invested nearly US$30 million in Goldfinch twice. However, in the following month, Goldfinch incurred US$20 million in bad debts because the borrower's "investment did not meet expectations." In October last year, the Goldfinch governance platform released another report stating that a lending pool on the platform had bad debts and that $7 million was at risk of loss.

Unlike over-collateralized lending in regular DeFi, the Private Credit Protocol (i.e. RWA Lending Protocol) is designed to allow real-world businesses to obtain unsecured loans based on their credit history, while on-chain funds obtain off-chain returns through the protocol. These protocol third-party institutions evaluate borrowers and lend them as liquidity to potential borrowers by establishing pools of funds. Compared with concepts such as "gold on the chain" and "real estate on the chain", on-chain credit is already a relatively mature RWA model in the industrial chain, but even so, these agreements are still difficult to form a flywheel.

A direct reason is the extremely high threshold when guiding users. In most cases, users must go through KYC procedures before they can participate in the protocol's lending pool. This deviates from the image that most DeFi users pursue "permissionless" and "code is law", and to a certain extent makes the protocol become To B product. In fact, this is also the main problem faced by most RWA projects, that is, the misalignment of product positioning and user portraits. In an industry full of ultra-high ROI, most "Degens" don't seem to be interested in the income opportunities that these off-chain assets can bring. Whether it is gold, real estate or art, the growth rate is difficult to match that of popular tokens. Comparable.

On the other hand, the stability and security of off-chain revenue sources are also major issues faced by the RWA lending protocol. During 2021 and 2022, almost all of Maple Finance’s active credit was lost to native institutions within the crypto industry, most of which experienced thunderstorms during the bear market. At the end of 2021, Maple provided $25 million to Alameda Research, the trading company behind FTX, on the grounds that Alameda promised to grow the borrowing amount to $1 billion within 12 months. In order to prove that the on-chain credit model works, Maple puts the rate of return first when choosing loan objects. The final result is: the so-called off-chain income brought by RWA actually comes from the crazy leverage of crypto. mechanism.

The difficulties encountered by Goldfinch reflect a more frustrating fact, that is, companies and entities that can obtain financing through conventional channels often do not choose on-chain financing. Goldfinch is indeed seriously looking for lending scenarios outside of the crypto industry, mostly focusing on the start-up industry and small and micro loans in developing countries and regions. The former are often the "lower horses" left over by top VCs, while the latter have their own Extremely high failure rate. On the one hand, it needs to bear higher risks, on the other hand, the rate of return is not as good as the expectations of currency speculation, and the double debuff of products and users has always made RWA difficult.

This time, the fundamentals have changed

Interestingly, the RWA narrative has been on the rise again since last June, however this time, its fundamentals have undergone important changes.

When the whales on the chain set their sights on 5% annual growth

On the eve of Sanjian Capital’s storm, the team found that there were almost no scenarios where the assets they managed could generate expected returns. As the Federal Reserve begins the process of raising interest rates, liquidity crunch has eroded various markets around the world, especially cryptocurrencies, which are defined as risky assets. Corresponding to the steady increase in yields on U.S. bonds since the end of 2021, DeFi has gradually declined in its income level. The median income has dropped from 6% in early 2022 to 2% in July 2023, which is almost unfavorable to large investors. It’s profitable, because the risk-free return has reached 5%.

When on-chain returns are low enough, real-world returns are much better, which means that the main bottleneck plaguing the RWA protocol has changed, that is, the encryption industry has become interested in off-chain returns. In response to the continuous flight of funds from the industry, the industry began to think about how to bring the risk-free returns of U.S. debt to the chain, so RWA once again became a savior in people's eyes.

In August 2023, the Spark Protocol page of MakerDAO’s lending protocol showed that the DAI deposit interest rate (DSR) had been raised to 8%, and DeFi, which had been dormant for a long time, was rekindled. Within a week, the amount of protocol DSR revenue climbed by nearly $1 billion, and the circulating supply of DAI surged by $800 million, hitting a three-month high.

Giving huge returns in deep bear conditions, Maker’s secret ingredient is RWA. According to The Defiant statistics, nearly 80% of MakerDAO’s fee income in the past year, based on total TVL, came from RWA assets. Starting in May 2023, MakerDAO gradually increased its risk exposure to RWA. In addition to deploying funds to Coinbase Prime, it also purchased U.S. Treasury bonds in large quantities in batches through its two entities, Montalis Clydesdale and BlockTower. In addition, BlockTower Credit also Up to $220 million in lending funds have been deployed on the RWA lending protocol Centrifuge. According to data from Dune Analytics, MakerDAO has a RWA investment portfolio of nearly $2.5 billion as of July 2023, including more than $1 billion in U.S. Treasury bonds.

The sudden high profits have made RWA the most controversial topic in the Maker community. After the Tornado Cash case, the desire of native crypto users to get rid of the shackles of centralized power has become stronger. On the one hand, DAI’s increased dependence on U.S. debt has reduced DeFi’s ability to resist regulation. On the other hand, it also means that once the Federal Reserve reverses , the RWA agreement that relies on U.S. debt will fail again.

But vision-level concerns cannot hinder the encryption industry’s drive to make money, and RWA has revived people’s interest in DeFi. The ultra-high returns of blue-chip stablecoins had a ripple effect in the DeFi ecosystem, and the Aave community quickly proposed listing sDAI as collateral in order to indirectly gain leveraged exposure to U.S. debt. DAI has transformed from a liquid product into the "yield Lego" of the DeFi world. Any protocol that wants to gain exposure to RWA can create its own sustainable income based on DAI. MakerDAO governance token holders have also begun to see large inflows of capital. , MKR increased by more than 35% in a single month, becoming one of the best-performing tokens on the market.

MakerDAO’s successful exploration in the RWA field has set off another RWA boom in the industry. Also in June, the founder of Compound announced his new company Superstate, which is specifically responsible for bringing assets such as bonds to the chain to provide potential customers with returns comparable to those in the real world. After the news was announced, the COMP token price rose by more than 23% in 24 hours. Since then, protocols such as Ondo Finance and Matrixdoc have also begun their exploration in the field of U.S. debt tokenization.

The gears of the "regular army" are turning

In June last year, BlackRock, the world's largest asset management group, submitted a document application for a spot Bitcoin ETF to the US SEC through its subsidiary iShares, and a new round of crypto bull market began immediately. Since its launch in January this year, IBIT has continued to set new BlackRock fund records. BlackRock's first-quarter financial report in April this year showed that IBIT has attracted a net inflow of approximately US$13.9 billion, accounting for 21% of the total net inflow of its ETF products. This figure reached 26% in June, and BlackRock CEO Larry Fink even called IBIT "the fastest-growing ETF in history."

After the Hong Kong Web3.0 Summit in April 2023, the gears of institutional on-chain exploration have begun to turn. In July of the same year, Huang Lexin, head of the financial technology group of the Hong Kong Securities and Futures Commission (SFC), said in an interview that the SFC would change its previous view on STO and that security tokens (Securities Tokens) or RWAs would not be defined as complex products. RWAs It will be supervised according to the underlying endorsement asset type and has the opportunity to be opened to retail investors.

The ambition of institutions to deploy the crypto industry goes far beyond ETFs. Blackrock CEO Larry Fink said at the end of 2022 that "the next generation of markets, the next generation of securities, will be the tokenization of securities." Tyrone Loban, head of Onyx blockchain at JPMorgan Chase, has the idea of ​​"transforming trillions of dollars of assets into Bring DeFi in and make it as large as institutional assets so you can trade, borrow and lend using these new mechanisms.”

In addition to the internal driving force from the industry, a key reason for the revival of the RWA narrative is the exploratory interest from external forces such as governments and large financial institutions. The active participation of traditional institutions means that the situation of the RWA protocol chasing the attention of the real world has changed. "Putting your own financial products on the chain" has become the demand of external institutions for the encryption industry.

In March this year, BlackRock launched BUIDL, its first tokenized fund issued on a public blockchain, offering accredited investors the opportunity to earn USD income. BlackRock stated in the announcement that tokenization remains the focus of its digital asset strategy. It will realize the issuance and trading of ownership on the blockchain through the tokenization of funds, with a view to expanding investors’ access to on-chain products and providing instant and transparent settlement and cross-platform transfers.

Similar to the Bitcoin spot ETF application, the emergence of BUIDL once again triggered the concept of RWA. Traditional financial giants began to test the waters on the chain. Many analysts even called it "bringing legitimacy" to public smart contract chains such as Ethereum. . In less than 10 days since its launch, the volume of the BUIDL fund has grown to US$274 million. This has been accompanied by a substantial increase in the market value of tokenized RWA (including treasury bonds, bonds and cash equivalents), which has increased by nearly 35% since the beginning of April. It currently exceeds US$1.5 billion.

The driving role of BUIDL is obvious. The U.S. bond market on the entire chain has shown a clear upward trend after the launch of BUIDL. The previously relatively silent U.S. government currency fund FOBXX on the Franklin Templeton chain has grown rapidly by nearly 27%. , in the encryption industry, Ondo Finance, which also transformed the US debt RWA protocol, also quickly doubled its TVL to US$500 million driven by the "BlackRock Concept".

The gears of the huge machine have begun to turn. There is almost no doubt that after Hong Kong's Web3 New Deal and BlackRock took the lead in exploring tokenization, the process of institutions "trying to get on the chain" will become more and more obvious. The technical demands for blockchain infrastructure will also grow and become more abundant. For crypto-native projects that are struggling to find a better business model, this is a rare and huge To B opportunity.

To B business is booming, who is on the forefront?

After the trend emerged, the amount of financing in the RWA field surged this year. Many teams want to seize this opportunity, but most people’s motivation is still to “catch up on the popularity.” Even the former meme currency project TokenFi also stated that it will Enter the RWA field. However, when it comes to the trend, not everyone can accurately grasp the opportunities in the market.

RWA Public Chain

Except for Polygon, which has the second highest tokenized U.S. debt TVL, Avalanche can be regarded as the first L1 public chain to fully embrace RWA. As one of the three new public chain giants in the last cycle, Avalanche chose the opposite development path to Solana after entering the bear market. Since the end of 2022, Avalanche has begun high-frequency exploration in the direction of enterprise-level applications, and its special subnet structure has also enabled the team to make rapid progress in this field. The Avalanche subnet architecture empowers institutions to deploy custom blockchains optimized for their specific use cases and seamlessly interoperate with various Avalanche networks, enabling unrestricted scalability. From the end of 2022 to the beginning of 2023, entertainment giants from South Korea, Japan and India have established their own subnets on Avalanche.

The sensitivity to institutions also allowed Avalanche to be the first to observe the asset tokenization trend in Hong Kong. During the Hong Kong Web3.0 Summit in April 2023, Avalanche launched the Evergreen subnet, designed to meet the financial services requirements of specific companies and the entire industry. Evergreen is a set of institutional blockchain deployment services and tools specifically designed for financial services. Institutions deploy blockchain settlement strategies with licensed counterparties on the private chain based on the Evergreen subnet, and through the Avalanche native communication protocol (AWM ) to maintain interoperability with other subnets.

Evergreen’s solution directly meets the needs of institutions to combine public and private blockchains. It immediately attracted the attention of institutions such as WisdomTree and Cumberland after it went online, and participated in the network after the launch of the Evergreen test network Spruce. Coming to development and testing. In November of the same year, Avalanche also reached a cooperation with J.P. Morgan's digital asset platform Onyx, using the full-chain interoperability protocol LayerZero to connect Onyx and Evergreen to promote the tokenized asset subscription and redemption functions provided by WisdomTree Prime. This cooperation was also included in Singapore In the "Guardian Scheme" launched by the Monetary Authority (MAS) in cooperation with the financial industry.

Since then, Avalanche has successively announced various RWA cooperation with institutions. In November, it helped the financial services company Republic launch its tokenized investment fund Republic Note. In February 2024, it helped Citibank and WisdomTree and other institutions conduct private equity on the Spruce test network. The fund's tokenization concept trial, in March, cooperated with ANZ and Chainlink to use CCIP to connect Avalanche and the tokenized asset settlement of the Ethereum blockchain, and in April it helped integrate the payment giant Stripe.

Foundations within the ecosystem are also working hard in the direction of RWA, launching the Avalanche Vista plan and investing US$50 million to purchase tokenized assets issued within the ecosystem, including bonds, real estate, etc. In addition, the ecological fund Blizzard Fund is also actively investing in and attracting RWA projects such as Balcony and Re into the ecosystem. According to John Wu, CEO of Ava Labs, Avalanche’s mission is to “present the world’s assets on the chain.” Different from the traditional financial track, blockchain can complete settlement immediately. Now institutions have seen this kind of instant settlement solution that cannot exist in the real world. The rise of RWA can bring entities subject to strong supervision into the on-chain space and realize more possibilities. sex, and Avalanche will strive to be the best choice for their winding.

"BlackRock Concept"

Although RWA covers a wide range of assets, after the entry of MakerDAO and BlackRock, tokenized U.S. bonds have undoubtedly become the most popular RWA product, with a market value in about a year It has grown nearly 10 times, from about US$100 million at the beginning of 2023 to nearly US$1 billion at the beginning of 2024.

Unlike tokenized assets such as gold and real estate, tokenized U.S. bonds are not directly supported by the U.S. Treasury, but are often brought to the market in the form of Money Market Funds. Therefore, the issuer of the U.S. Treasury RWA is also a licensed fund manager responsible for creating and managing money market funds and issuing fund units to holders as tokenized treasury.

But money market funds are regulated capital market products, and investors’ investments will also be restricted by relevant rules and regulations, which means investors need to undergo a KYC certification process before purchasing. In addition, since the assets of the fund must be handed over to the custodian for safekeeping, in addition to purchasing and selling assets, the fund manager must also directly cooperate with the custodian to carry out new user guidance, net settlement, reconciliation and other operational work, and the custodian will have complete An updated list of holders and their balance books.

The BUIDL fund issued by BlackRock in March this year is exactly this kind of tokenized money market fund. It invests all its total assets in cash, U.S. debt and repurchase agreements and other U.S. dollar cash equivalents. BlackRock will Accrued dividends are paid directly into investors’ wallets as new tokens, allowing investors to earn while holding tokens on the blockchain. Under the shining light of BlackRock, Securitize, the issuer and manager of the BUIDL fund, quickly entered people's field of vision and became a "hot potato" in the RWA field.

Securitize, which cooperates with BlackRock this time, has focused on the RWA field for a long time and has provided services to many large-scale asset securities companies. After obtaining SEC transfer agent registration in 2019, Securitize raised $48 million in funding in 2021 led by Blockchain Capital and Morgan Stanley. In September 2022, the team helped KKR, one of the largest investment management companies in the United States, tokenize some of its private equity funds on Avalanche. The following year, also on Avalanche, Securitize issued equity tokens for Spanish real estate investment trust Mancipi Partners, becoming the first company to issue and trade tokenized securities under the EU’s new digital asset pilot regime.

After embracing BlackRock this year, Securitize once again received US$47 million in strategic financing led by BlackRock in May. The financing funds will be used to further accelerate its partnerships in the financial services ecosystem. As part of the investment, Joseph Chalom, BlackRock's head of global strategic ecosystem partnerships, was appointed to Securitize's board of directors. In the new wave of RWA launched by BlackRock, Securitize is undoubtedly the biggest winner.

There is also a type of crypto-native RWA protocol that, after smelling the wind, accurately grasped the opportunity to take off, of which Ondo Finance is a typical representative.

In August 2021, Ondo Finance announced the completion of US$4 million in financing with participation from Pantera Capital, DCG and others, preparing to provide sustainable returns to investors on the chain. In January 2023, Ondo officially launched three tokenized funds, including OUSG (U.S. Government Bond Fund), OSTB (Short-Term Investment Grade Bond Fund) and OHYG (High-Yield Corporate Bond Fund), for which Ondo charges 0.15% per year management fees. Of course, similar to the situation mentioned above, Ondo’s tokenized fund has always struggled with PMF.

But when the RWA spring breeze blew again in the industry, Ondo responded immediately. In January this year, Ondo Finance announced its "ecosystem directory" on social platforms, including cooperative providers in the fields of RWA business liquidity, custody and asset management companies, including BlackRock, Morgan Stanley and other financial institutions. The name of the giant. Officials said the directory was designed to help the agreement "focus its work on these partners," with an unexpected twist: We will "work closely" with BlackRock.

Subsequently in the month when the BUIDL fund was launched, Ondo immediately announced major adjustments to its U.S. bond product OUSG. In addition to improvements in the purchase and redemption mechanism, the most eye-catching aspect of this adjustment was that it transferred most of the assets of OUSG (approximately $95 million) to be reallocated to the BUIDL Fund. The team claimed that this behavior could help them transfer token-backed assets from "less than ideal trading funds" to blockchain-based tokenized funds. Ondo immediately became the leading hype target of RWA and "BlackRock Concept". The price of the token increased by more than 110% in a week.

Scale effect is the ultimate winner

Whether it is the public chain of "To RWA" or the issuers and managers of on-chain assets such as Securitize, most of their development and launch are driven by the interest of financial institutions such as BlackRock. Decide. In other words, the opportunity for the current RWA narrative comes entirely from the customized needs of traditional financial institutions. For the industry, relying on the power of financial giants is not the optimal solution to achieve growth. Solving the fragmentation problems of internal infrastructure and liquidity and achieving economies of scale are the keys to self-reliance and self-reliance.

Liquidity fragmentation

The biggest benefit of tokenizing real-world assets is that it can provide faster and more efficient trading and settlement processes for these assets. This is undoubtedly the main reason why all institutions are interested in RWA. Although there is no logical problem with this idea, it will encounter many difficulties at the technical level when it is actually promoted. The fragmentation of liquidity after assets are put on the chain is one of them.

When RWA is on-chain and traded, it is full of complexity, and the fragmented market makes this problem even worse. Digital Asset Research emphasized in its report in July last year that among current RWA institutions, more than 60% are trading through their own tokenized asset markets, which means that after the assets are completed on the chain after "going through hardships" , can only attract a small number of fixed customers.

According to statistics from The Block, the total financing scale of the RWA track has also reversed the downward trend this year and rebounded to US$300 million. The current trend recovery of RWA has allowed many entrepreneurs to see new "narrative opportunities", and the number of RWA concept projects on the market is also increasing at a speed visible to the naked eye. However, most of the projects that receive financing tend to focus on particularly small vertical areas, such as natural resources, specific commodities, and art. RWA projects in the real estate sector are particularly obvious in this regard.

To what extent can this vertical category be subdivided? For example, platforms such as Balcony and Mnzl provide tokenization processes for regional real estate resources. Often the assets on the chain and the buyers and sellers who trade through on-chain tools are local institutions or government departments. You can basically see Create a semi-closed asset market.

The categorization and regionalization of RWA projects is indeed understandable. After all, many real-world assets have strong regional characteristics, which often require dedicated personnel and dedicated posts to prescribe the right medicine. However, due to different regulatory restrictions in different places, each RWA project is almost building its own on-chain process and trading platform from scratch. At the same time, there are different choices when choosing technology stacks such as the underlying public chain and smart contract development tools, which makes different Interoperability between RWAs poses significant challenges.

Many entrepreneurs have seen this fragmentation of liquidity, so during the same period, RWA asset aggregation platforms or RWA launch platforms such as Midas and Plume began to appear in the market. However, when you think further, you will find that they are still Facing a dilemma: If you want to establish a unified market, you must first have certain compatibility in terms of token and contract standards, which hinders the platform from aggregating RWA assets on a large scale and in multiple categories. And if you take the lead in aggregating different RWA protocols, you will be limited to the role of a "launching platform" due to the differences in technology stacks between protocols. Although it brings some liquidity to small projects, it still requires a lot of effort for the assets on the chain. Facing the problem of market fragmentation.

This is true even for the most liquid tokenized U.S. bond market. Although the scale problem of single categories has been solved with the push of BlackRock, Franklin Templeton and other institutions, you will still find that in order to Allowing future potential investors and cooperative projects to have more choices, these assets are also dispersed on different public chains such as Ethereum, Stellar, and Avalanche.

This also brings a narrative window to cross-chain interoperability protocols that have been slow to gain momentum, such as Axelar, which has started laying out RWA very early. Last year, we launched Centrifuge Everywhere and Ondo Bridge in partnership with Centrifuge and Ondo respectively to optimize the protocol and inter-chain interoperability and liquidity for RWA tokenized products. In the current market environment with obvious fragmentation problems, cross-chain interoperability may not be a compensatory solution.

Self-reliance at the weakest link

In fact, it is not difficult to see that the bottleneck of RWA breaking through the scale limit is the lack of automated processes or technologies such as AMM in the DeFi field. For RWA products, tokenization is often just the beginning. Ensuring continuous asset updates and transparency after the product is put on the chain is the key to testing efficiency and cost. Generally speaking, it includes the following aspects:

1. Financial report: Asset managers need to regularly publish financial and performance reports on assets. For example, real estate managers need to regularly provide payment dates and amounts of rental income, or details of arrears and vacancies to give investors a clearer understanding of the property’s cash. Flow dynamics.

2. Debt management: Products such as RWA credit need to regularly update the details of the loan's mortgage, repayment, interest rate adjustment and refinancing activities to let investors understand its health. This is why such products maintain investors The basis of trust.

3. Ownership changes: If the basic ownership of the underlying assets or the legal entity that owns the assets changes, timely announcements are also required.

4. Market supervision: When the market supervision environment where the underlying assets are located changes, managers also need to report and make corresponding adjustments to ensure product compliance.

Of course, in addition to this, there are also complicated details such as asset insurance and risk management strategies, asset valuation and inspection, issuing legal entities, etc. A real-world asset starts from tokenization to information update and maintenance All require asset managers to devote a lot of energy and attention to various details throughout the entire investment life cycle. In short, in the current market environment of "redundant infrastructure", putting assets on the chain is no longer the most difficult part of RWA development. Continuous verification off the chain and legal supervision are what slow down the growth of asset categories and scale and wear down the value of assets on the chain. main reason. All this can only be discussed under the premise of putting aside the risk of centralized auditing of off-chain entities.

The scale and growth rate of RWA assets completely depend on the strength of off-chain issuance and management institutions. This is also an important reason why U.S. bond RWA products have grown rapidly after BlackRock entered the market. In comparison, other products such as Assets such as real estate and commodities have difficulty achieving economies of scale because they have not enhanced automation in their processes. Of course, the value erosion of on-chain assets also means huge business opportunities, and for now, this potential income basically flows into the hands of asset issuers and managers like Securitize.

Is it possible to build our own automated "asset oracle" system in the RWA field just like ChainLink does for DeFi? We found some answers with this project Jiritsu.

Jiritsu is an Avalanche L1 specifically designed for off-chain asset verification. It aims to automate and detrust off-chain asset registration and verification, while improving the economic efficiency and transparency of RWA tokenization while reducing on-chain wear and cost. By integrating ZK proofs and MPC multi-party computation, Jiritsu is able to ensure secure and private automated verification of asset details while embedding regulatory compliance and asset integrity into tokenized products. Interestingly, the name "Jiritsu" comes from the Japanese "じりつ", which means self-reliance. In the current RWA field, where the core link relies heavily on centralized manpower, this is what is most needed to enhance the native attributes of encryption and achieve economies of scale.

Jiritsu ZK-MPC oracle aggregates data from multiple sources and verifies related calculations, and adopts a versatile data retrieval mechanism to enhance the depth of integration of different types of assets. The oracle machine includes two main mechanisms: "Push" and "Pull". The former allows data providers (such as asset managers) to directly send information to the oracle machine, while the latter allows the oracle machine to directly collect information from the oracle machine through the API. Integrate information providers' systems such as supply chain software, banking information, etc. and obtain data.

In terms of consensus mechanism, Jiritsu introduces the concept of Proof of Workflow (PoWF). The nodes in the network run an operating system driven by a computing engine and a workflow manager, and use the generated ZK proof to ensure verifiable calculation and smart contract execution. Consensus mechanism to integrate the consensus mechanism directly into its MPC framework. Compared with existing oracles such as ChainLink or Pyth, Jiritsu does not need to use cross-chain bridges for information transmission when aggregating information, and it also adds information analysis and verification functions in addition to simple data feedback.

After a user or asset manager registers the assets they wish to tokenize and their details in Jiritsu, the ZK-MPC validator will analyze the information and confirm the value and compliance status of the assets. The analysis process involves two types of validators, one used to review business policies and regulatory compliance, and the other used to process financial data and perform tasks such as spot price retrieval and market price assessment. After the information is analyzed and verified, ZK-MPC will generate ZK certificates and store them on the chain. Users can then claim these certificates and embed them into their own smart contracts. In this way, the entire asset tokenization process is complete. .

Jiritsu officials took Paxos’ tokenized gold product PAXG as an example to demonstrate the complete process of using its product:

First, Paxos purchases gold through a reliable gold exchange and deposits it into a custody service institution. Jiritsu users can then create validators on ZK-MPC nodes on the Jiritsu network using Jiritsu dApps on supported public chains. After the ZK-MPC node retrieves the gold custody information about Paxos, the relevant ZK proof is generated by the validator.

During the verification process, the ZK-MPC node is responsible for off-chain verification calculations, and the generated ZK certificates also have different levels of access and confidentiality permissions. For example, auditors can have full access to all information, while asset managers can only See specific information related to their role. This verification process can update information at preset times or on demand, making it far more efficient and reliable than Paxos' current method of manually verifying inventory every quarter.

After ZK proofs are uploaded to the Jiritsu network, Paxos can move forward with the tokenization of its custodial gold. In this link, Jiritsu also implements the concept of "chain abstraction", allowing asset issuers like Paxos to mint corresponding tokens on ideal target chains such as Solana, Avalanche or BNB Chain.

After token generation, Paxos pays nodes and validators through the Jiritsu dApp, a portion of which will be distributed to the Jiritsu network. The PAXG tokens purchased by investors will contain a certificate of the underlying gold and can use this certificate to access gold custody status information on the Jiritsu network, where Paxos can pass the cost of fees to the investor.

The dApps on the Jiritsu network are specifically designed to facilitate the writing of specific data, allowing users to create validators for any business logic, data readers, and smart contract integrations. This adaptability ensures that Jiritsu can be used for a wide range of businesses The ability to provide customized solutions is required. In addition, Jiritsu Proof under its ZK-MPC cloud service has significantly expanded the asset categories for information verification. In addition to traditional financial verification such as bank information and company credit, it can also verify the status information of a range of real-world assets, such as equipment in company plants. , inventory, transaction and revenue information, etc. Jiritsu recently provided inventory certificates for an Amazon supply chain company with over 100,000 SKUs and a total value of approximately US$20 million.

これに基づいて、ジリツはまた、「総資産検証済み」と「総資産保護済み」という2つのデータ指標を通じてチェーン上の現実世界の資産への影響を測定し、これらのデータ指標を使用して、より互換性があり相互運用可能な基礎資産をDeFiプロトコルに提供します。 Dune の公式ダッシュボード データによると、Jiritsu はこれまでに 180 億米ドルを超える資産を検証しており、常に 6,000 万米ドルを超える資産がさまざまなプロトコルで使用されるのを待っています。

つい最近、Jiritsu は BlackRock の RWA エコシステムを統合して、ビットコイン スポット ETF と BUIDL ファンドの準備資産の評価と検証、コンプライアンス、KYC プラットフォーム情報の自動化されたオンチェーン認証を提供し、他のプロトコルでこれらの資産を使用できるようにしました。より便利かつ迅速にチェーンに接続できるようになりました。一方で、iBIT と BUIDL は仮想通貨市場と RWA に巨額の追加資金をもたらしていますが、その資産検証は依然として自己申告に依存しており、年次監査のみを提供しているのに対し、Jiritsu はこれらの製品により高い透明性とコストをもたらします。効率的なソリューションです。

ジリツは、RWA の分野に深く関与している Republic プラットフォームとも統合しており、あらゆる資産運用会社が同様のソリューションを直接実装して使用できるようにするとともに、さまざまなトークン化された製品を提供しながら、コンプライアンスと運用効率、資産管理の効率を向上させています。 Republic が提供する成熟したインフラストラクチャをトークン化、コンプライアンスのほか、マーケティングや顧客サービスにも使用できます。ジリツは、自動化されたトラストレスな検証と監査を通じて、ムーディーズ、KPMG、その他の機関によって過去に行われてきた作業をチェーンに移行します。従来の市場のこの部分の手数料収入は、10 ドルで計算しても 1,500 億米ドルを超えます。 %、これは非常に想像力豊かなビジネスの上限です。

良いコインは悪いコインを駆逐する

DeFi、GameFiからNFTまで、暗号業界の過去の成功事例は、新しいユーザーと資金を引き付けるためにネイティブチェーン資産とインタラクティブフォームの革新に依存してきました。しかし、RWAのコンセプトは次のとおりです。外部と統合 世界の価値をチェーンにもたらします。したがって、多くの仮想通貨ネイティブユーザーは、RWAの言説に常に抵抗しており、現実世界の資産をチェーンに持ち込むことは、第一に仮想通貨ユーザーの「標的を絞った収穫」であり、第二に、仮想通貨の価値成長余地を圧迫することになると信じている。ネイティブ資産。さらに、超高ボラティリティに慣れている暗号通貨ユーザーは、現実世界の資産の「低いリターン」には興味がありません。 RWA はこれまで、製品のポジショニングとユーザーのニーズの不一致が主な原因で、停滞していました。

しかし、昨年後半以降、RWA 分野の基礎は重要な変化を遂げてきましたが、一方では暗号ネイティブのプロトコルが持続的かつ安定した収益性に対する需要を生み出し始め、他方では従来のプロトコルに対する需要が生まれ始めました。金融機関はブラックロックの影響を受けて開発を開始しており、オンチェーン金融商品を積極的に検討しています。従来の金融機関にとって、ブロックチェーンの即時決済は損耗を軽減するだけでなく、敷居の高い金融商品へのより幅広い投資家層をもたらし、金融商品の取引量と手数料収入を増加させることができます。製品のポジショニングとユーザーのニーズはもはや一致せず、物語の回復は避けられないものとなっています。

暗号化業界にとって、RWA はネイティブ チェーンの資産のように個人投資家に超高成長をもたらすことはできませんが、ブロックチェーンを「ユースケースの時代」に導き始めています。従来の金融機関にとって、RWA 資産は低コストと高取引量という特性に加えて、オープン性と透明性という特性も備えています。短期的には、これは金融業界に大きな影響を与えないようですが、規模効果が達成されると、RWA資産のこの特性は、投資家が意思決定を行う際の非常に重要な参考指標になると想像したほうがよいでしょう。一方で、伝統的な機関による「ブラックボックス商品」と、リアルタイム決済とオープン性と透明性を備えたオンチェーン商品があります。原資産が同じ場合、どのように選択しますか?従来の金融機関にとって、RWA は良貨が悪貨を駆逐するゲームであることは疑いの余地がありません。

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