Ethereum Poised to Dominate Trillion-Dollar Tokenization Market, Standard Chartered Reports

The tokenization of real-world assets (RWAs) is projected to explode, with Ethereum expected to be the primary blockchain for this burgeoning market. Standard Chartered forecasts the RWA market cap could reach $2 trillion by 2028, a significant leap from its current $35 billion. This growth is fueled by stablecoins creating essential infrastructure for broader decentralized finance (DeFi) expansion.

Key Takeaways

• The tokenization market for real-world assets is predicted to surge to $2 trillion by 2028.

• Ethereum is anticipated to be the dominant blockchain for tokenized assets due to its reliability and network effects.

• Tokenized money market funds and equities are expected to be major contributors to this growth.

• Regulatory clarity in the U.S. remains a key factor for sustained growth.

The Rise of Tokenized Real-World Assets

Standard Chartered's head of digital assets research, Geoffrey Kendrick, predicts a massive expansion in the tokenization of real-world assets. He estimates the market could grow by approximately 5,600% to reach $2 trillion by 2028. This growth is underpinned by the foundational role stablecoins have played in establishing increased public awareness, on-chain liquidity, and lending/borrowing activity within DeFi.

Kendrick specifically highlighted tokenized money market funds and listed equities as potential trillion-dollar markets on their own, with private equity, commodities, and corporate debt also contributing significantly to the overall tokenization landscape.

Ethereum's Dominance in Tokenization

Despite the potential for growth on other blockchains, Kendrick anticipates that the vast majority of tokenized real-world assets will reside on the Ethereum network. He cited Ethereum's decade-long history of reliability and established network effects as key advantages over competing chains, suggesting that factors like speed or lower transaction costs are secondary to its proven track record.

Fidelity's recent launch of its tokenized money market fund on Ethereum, with Ondo Finance holding $202 million in its tokens, further underscores Ethereum's central role. This move by a major investment management firm into tokenized Treasuries signifies a broader trend of traditional finance integrating with blockchain technology.

Potential Challenges and Future Outlook

While the outlook for tokenization is overwhelmingly positive, Standard Chartered has cautioned about potential risks. A significant concern is the lack of regulatory clarity in the United States. The report suggests that if regulatory frameworks are not established before the U.S. midterm elections in November 2026, it could pose a challenge to sustained growth, although this is not considered the base case scenario.

The increasing adoption of stablecoins has transformed DeFi from a niche sector into a more mainstream financial ecosystem, enabling non-bank entities to manage payments and savings. Lending and RWA tokenization are identified as the primary areas where DeFi protocols can significantly challenge and reshape traditional finance.

Sources

• The Daily: Standard Chartered sees major RWA growth on Ethereum, CZ challenges Sen. Warren, and more, The Block.

• Tokenization market to reach $2 trillion by 2028, Ethereum to dominate: Standard Chartered, FXStreet.

• Fidelity's Tokenized Money Market Fund Debuts on Ethereum With Ondo Holding $202M, CoinDesk.

• Ethereum Treasuries Have 'Highest Probability of Being Sustainable': Standard Chartered, Decrypt.