Key Developments in the Digital Asset Ecosystem

Exponential Growth in Real-World Assets (RWAs)

The tokenization of RWAs is transforming the landscape of traditional finance, heralding an era of unparalleled accessibility, liquidity, and efficiency. Unlike cryptocurrencies, RWAs possess an inherent asset-class specificity and a micro-market structure tailored to their needs, making a strong case for broader modernization goals of market infrastructure. This differentiation underscores the pivotal role of RWAs in the evolution of financial markets.

The tokenization of Real-World Assets is reshaping traditional finance, driving exponential growth, and transforming how assets are accessed, managed, and traded. On-chain RWA value has surged over 60% this year, reaching $13.7 billion, with private credit, T-Bills, and commodities leading the charge. Unlike cryptocurrencies, RWAs offer asset-class-specific clarity and tailored micro-market structures, making them distinct and increasingly appealing. Private credit alone grew by $4 billion in 2024, driven by streamlined infrastructure from firms like Figure, while T-Bills, with $2.67 billion tokenized on-chain, present a yield-generating alternative to stablecoins. DeFi's adoption of RWAs into lending markets and liquidity pools (DeFi realm) has further reduced barriers, accelerating inflows and solidifying RWAs’ role in financial innovation.

The ecosystem is rapidly maturing, with specialized tools for minting, wallet management, and risk mitigation paving the way for more complex assets, such as stocks, ETFs, and bonds, to be tokenized in the near future. Institutional players like Franklin Templeton and BlackRock are championing this shift, expanding tokenized funds across blockchains, and showcasing the scalability of these assets. With $203 billion in stablecoin value supporting this transformation, RWAs are no longer merely about modernizing infrastructure—they are about redefining finance. Heading into 2025, RWAs stand as a cornerstone of the digital asset economy, blending stability and innovation to unlock untapped liquidity and market opportunities.

Increasing Use Cases for Stablecoins

Stablecoins are emerging as an alternative settlement mechanism, as a means for payment efficiency and a definitive use case for blockchain technology. Through updating payment infrastructures, stablecoins are now a payment option within various segments of the ecosystem, from retail cross-border transactions to securities settlement. Additional, institutional adoption is accelerating this transformation, as evidenced by Stripe's $1.1 billion acquisition of Bridge and Visa's integration of USD Coin (USDC) on Solana to enable programmable, faster financial services. Additionally, PayPal’s PYUSD is being leveraged for venture investments, while Paxos’ Global Dollar (USDG) shows how stablecoins can help drive real-world applications. With $203 billion in stablecoin value held by over 131 million users, stablecoins are increasingly useful instruments for facilitating transactions in tokenized asset ecosystems.

Stablecoins are also increasingly being adopted by major corporations as an innovative treasury and payment solution to create efficiencies in cross-border transactions while mitigating foreign exchange risks and reducing costs. For instance, PayPal in 2024 utilized its proprietary stablecoin to pay auditors Ernst & Young via an SAP-provided hub, showcasing the efficiency of blockchain in international payments. Similarly, MoneyGram, in partnership with the Stellar blockchain network, has leveraged stablecoins like USDC for real-time settlements, facilitating seamless global remittances. Robinhood and Kraken have also launched a global dollar stablecoin network, enabling faster and more efficient transfers of stablecoin-backed dollars worldwide. The most notable case is SpaceX, which has used stablecoins in its payment system for Starlink services, particularly in regions with underdeveloped financial infrastructures, allowing local currency payments to be converted into stablecoins and then transferred and exchanged into U.S. dollars.

This shift could be bolstered by the potential for more supportive regulatory frameworks in various jurisdictions, such as anticipated stablecoin legislation in the U.S., which could promote liquidity, compliance, and collaboration. Stablecoins now account for approximately 1% of M2, a key economic indicator of available money for spending and investment, underscoring their macroeconomic impact. Beyond payment modernization, stablecoins are helping to enable innovative financial services, driving financial inclusion, and laying the foundation for a programmable, tokenized economy.

These examples highlight how stablecoins are becoming increasingly useful for corporate cross-border treasury management and payment systems, driving efficiency, and reducing financial complexities.

U.S. Elections: A New Digital Assets Perspective

The U.S. election result likely signals a shift in the regulatory and policy landscape for cryptocurrencies and digital assets, with the new administration demonstrating a clear commitment to fostering innovation and embracing digital assets. This will likely take shape with the Administration by limiting the regulation by enforcement environment and working with the industry to find areas where regulation can be flexible to account for new innovative services. These initiatives reflect a move toward providing legal and regulatory clarity that promotes growth while ensuring compliance.

President-elect Donald Trump’s key appointments illustrate this more industry-friendly vision. Paul Atkins, nominated to chair the SEC, is an advocate for reducing regulatory burdens and fostering innovation, signaling a more collaborative approach to overseeing digital assets. David Sacks, appointed as the White House "AI and Crypto Czar," will coordinate digital assets and AI efforts throughout the government while addressing longstanding ambiguities. Additionally, Sriram Krishnan, was named Senior Policy Advisor for Artificial Intelligence, bringing expertise at the intersection of AI and digital assets and Bo Hines, was selected as Executive Director of the Presidential Council of Advisers for Digital Assets which will shape policies that support blockchain and cryptocurrency adoption. Lastly, Michael Kratsios, with a background in technology policy, will steer the administration’s approach to emerging technologies, ensuring that innovation in digital assets aligns with broader technological advancements.

The newly announced Presidential Council of Advisers for Digital Assets chaired by David Sacks (ex Paypal executive and a Prominent VC) and supported by Bo Hines as executive director, underscores the administration’s focus on integrating digital assets into the financial system. With pivotal legislation like the FI21 Act and the Stablecoin Act gaining momentum, the industry is poised for advancements. These developments, alongside potential supportive regulatory reforms in the U.S., highlight a more advantageous environment for blockchain innovation. The digital assets industry is entering a transformative era, with ample opportunities to drive modernization in payment infrastructure, financial market infrastructure, and the tokenized economy. One of the clear winners of this election is the digital asset ecosystem, set to thrive in this new pro-innovation policy environment.