Real World Assets on the Blockchain: The True Value and Implementation Challenges of RWA

Recently, the concept of mapping real-world assets (RWA) onto the blockchain has garnered significant attention. From high-end financial forums to the entrepreneurial circle, it seems everyone is discussing "asset on-chain" and "real-world mapping." However, amidst this craze, we need to think calmly: What problems can RWA actually solve? What foundational conditions are needed for implementation?

Many people describe RWA as "on-chain reformation" of real assets. This statement is not incorrect, but true "reformation" should break down the existing information barriers and settlement processes.

In fact, many so-called RWA projects merely replicate data originally stored in traditional systems onto the blockchain. The entire business process remains unchanged, from asset generation, value confirmation to yield calculation and investment allocation, still relying on the project's offline operations team to process step by step. The on-chain record is at best just an "upgraded report."

Although this approach does indeed "use blockchain technology", it is hard to say that it has "changed the logic of financial operation". Converting asset information from paper contracts into data files on the blockchain does not equate to achieving true "tokenization of real-world assets".

If financial operations cannot be driven by blockchain, RWA will struggle to break through the initial stage.

Key Criteria for Determining the Authenticity of RWA

Many people believe that the core of RWA lies in "certification" - that is, the assets have a clear source and are registered on the chain. However, in fact, trustworthy data is just a basic condition. What truly determines whether RWA has financial value is whether it can achieve reliable settlement - that is, whether the fund flow mechanism on the chain can operate effectively.

Therefore, the value of RWA can be divided into two levels: the first level is trustworthy data, and the second level is trustworthy settlement.

The trusted data of the first layer refers to whether the changes in the state of real-world assets can be accurately recorded on-chain. This is not only a technical issue but also involves the transformation of business processes. External interfaces such as sensors, custodians, oracles, etc., need to push information to the chain in real-time, automatically, and objectively when asset changes occur. A true RWA project should achieve "on-chain recording as events occur," rather than relying on periodic manual uploads of "reports."

The trustworthy clearing of the second layer is the core value of RWA. This means that actions of value transfer such as profit distribution, principal repayment, default handling, and expense carryover must be automatically executed, tamper-proof, and publicly transparent. To achieve this, stablecoins must be introduced on-chain as the unit of currency.

Many projects overlook this key point: even with data and contract logic, if the settlement process still requires manual operation or simulating capital flow through a third-party platform, on-chain tokens are merely a symbolic representation rather than an executable financial right.

Therefore, to assess whether an RWA project is truly effective, two basic criteria can be referenced:

First, can data be automatically uploaded to the blockchain without relying on manual operations?

Secondly, can the funds flow be settled directly on the chain?

If these processes still require a lot of manual intervention, then the so-called "on-chain" and "on-chain settlement" may be mere talk. True RWA should realize automated and verifiable flows of data and funds to bring about a qualitative improvement in financial efficiency.

Stablecoin: The Key to RWA Implementation

The ideal RWA structure should be: natively on-chain, automatically operating, and real-time settlement. Once the data is generated, it is automatically written on-chain and cannot be tampered with; once the funds are triggered, they are automatically credited without manual intervention.

To achieve this goal, blockchain technology is needed as the underlying information layer, while stablecoins are required as the value carrier.

The core value of stablecoins in RWA is not the macro advantages often mentioned, such as cross-border payment efficiency or alternatives to banks, but rather that it enables funds to truly "flow" within the blockchain world. It can be programmed, invoked, and payments can be executed directly based on on-chain data, rather than relying on periodic manual settlements.

The greatest significance of stablecoins lies in their ability to make funds programmable and executable for the first time. Payment time, recipient, amount, and even payments triggered by specific on-chain events can be preset. It enables funds to flow automatically like data.

Only the RWA that uses stablecoins can run the entire lifecycle of assets - from generation, yield distribution to exit recovery - entirely on-chain in the form of smart contracts. Otherwise, even with multiple institutions participating and auditing endorsements, it essentially remains another form of a centralized platform.

Therefore, it is difficult for RWA projects without stablecoin applications to truly realize their promised value.