US Treasurys Lead RWA Tokenization Wave, 229% Market Surge Marks Mainstream Shift

The real-world assets (RWA) tokenization landscape has undergone a dramatic transformation in 2025, with onchain government debt becoming the primary catalyst for mainstream financial adoption. Market data reveals that the RWA sector—excluding stablecoins—expanded from $5.5 billion at year-end 2024 to $18.1 billion by the close of 2025, representing one of the steepest adoption curves in digital infrastructure history.

Tokenized Assets Hit Record $18.1B, With Treasurys Nearly Doubling Through 2025

Tokenized US Treasurys emerged as the dominant force driving this expansion. According to analysis from RWA.xyz and insights from major digital asset firms, tokenized government debt instruments surged from $3.91 billion to $8.68 billion throughout 2025—more than doubling in a single year. Meanwhile, private credit RWAs climbed from $9.85 billion to $18.58 billion, underscoring the broader appeal of onchain settlement for institutional asset classes.

The scale of this growth reflects a fundamental shift: RWA tokenization has transitioned from experimental pilot programs to a competitive, capital-intensive sector. Institutional issuers with proven operating track records now compete for market share, regulatory frameworks are taking shape, and traditional financial infrastructure providers increasingly recognize blockchain rails as legitimate alternatives to custodial systems.

Ethereum Solidifies Position as Primary Infrastructure for Onchain RWA Settlement

Among competing blockchain networks, Ethereum has established commanding dominance in the tokenized Treasurys market. Current data indicates that more than $4.9 billion in tokenized US government debt now settles on Ethereum, reflecting the network’s superior combination of liquidity depth, institutional tooling, and operational maturity.

This concentration reflects practical, rather than speculative, considerations. Regulated financial institutions continue to favor Ethereum for issuance and settlement because the network offers battle-tested smart contract capabilities, deep liquidity pools, and an ecosystem of infrastructure providers optimized for institutional workflows. While alternative chains actively compete for RWA market share, none have displaced Ethereum as the preferred execution layer for serious capital allocators.

Regulatory Recognition Drives 2026 RWA Tokenization Expansion

A critical factor accelerating RWA tokenization momentum is the increasing willingness of regulators to recognize blockchain infrastructure as legitimate market plumbing. Rather than viewing crypto settlement as inherently risky or speculative, regulatory bodies now acknowledge that onchain operations can reduce operational friction while improving auditability and transparency.

This regulatory evolution creates a virtuous cycle. As compliance frameworks solidify, traditional asset issuers gain confidence to deploy capital onchain. As institutional capital migrates to blockchain infrastructure, the incentive structure for competing networks intensifies. The question of which platforms will ultimately capture the majority of long-term RWA issuance remains unsettled, but the direction of travel is clear: traditional finance is integrating with digital infrastructure rather than competing against it.

What’s Next: Digital Assets Converging With Traditional Finance

Looking toward 2026, multiple indicators suggest that RWA tokenization will accelerate further. US Treasurys are positioned to remain the fastest-growing category within RWAs, driven by sustained global demand for USD-denominated yield and the operational advantages that onchain issuance and distribution provide. The efficiency gains are material: settlement times compress, intermediary layers shrink, and investors can seamlessly hold Treasurys onchain—a flexibility that traditional custody arrangements cannot match.

The broader narrative reflects a structural convergence: digital assets are no longer operating as a parallel financial system but are embedding themselves within traditional markets. 2025 witnessed the conditions for this integration mature; 2026 appears positioned to deliver its consolidation into mainstream real-world operations.