Blockchain fragmentation is costing tokenized RWAs up to $1.3B a year
Research from RWA.io finds blockchain fragmentation is imposing a measurable drag on the tokenized real‑world asset (RWA) market, costing an estimated $600 million–$1.3 billion annually today. The report, compiled with input from 17 firms including Coinbase, Franklin Templeton and Polygon, estimates over $36 billion in tokenized RWAs now in circulation and identifies two main frictions: price dispersion and cross‑chain transfer costs. Identical or economically equivalent tokenized assets commonly trade 1%–3% apart on different chains. Moving assets between chains typically incurs ~2%–5% loss per reallocation from exchange fees, slippage, gas, transfer delays and operational risk (model average ≈3.5%), making many arbitrage opportunities uneconomic. Ethereum holds roughly 52% of tokenized RWA value while Polygon accounts for a large share of tokenized bonds, underscoring a multi‑chain market with operational friction. RWA.io projects tokenized RWAs could expand to $16–$30 trillion by 2030; if fragmentation persists, annual value drag could scale to $30–$75 billion. RWA.io COO Marko Vidrih called fragmentation the main barrier to realizing the market’s multi‑trillion potential. Despite these inefficiencies, tokenization momentum continues — examples include Securitize’s on‑chain stock plans and Coinbase’s stock trading feature. For traders, fragmentation creates both arbitrage windows and heightened execution risk, higher transaction costs and lower effective returns on tokenized debt, private credit and commodity exposures.
Neutral
The news is neutral for crypto prices overall but material for traders in tokenized RWA markets. Short term, the report highlights actionable arbitrage opportunities from 1%–3% price dispersion across chains; active traders may profit if they can execute fast and cheaply. However, prevalent cross‑chain costs (~2%–5%) and operational risk often negate easy arbitrage, increasing execution risk and transaction costs. That tends to reduce effective yields on tokenized debt and make reallocations costly, which can depress demand for on‑chain RWA exposure relative to ideal expectations. Long term, the report signals structural frictions that must be resolved for large-scale growth: if fragmentation persists, the drag on returns could scale with market expansion (RWA.io projects $16–$30 trillion by 2030), implying larger macroeconomic consequences for tokenized markets. Overall, the immediate price impact across major crypto assets is limited (neutral), but the development is bearish for the relative attractiveness and liquidity of tokenized RWA products until cross‑chain friction is reduced.