Why the Next Trillion-Dollar RWAs Needs an Alternative Trading System + Blockchain?
August 22, 2025
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At the time of writing, the sum total of real estate, gold, antiques, and private equity stands at $410 trillion, ripe for innovation. RWA tokenization undoubtedly transformed that, but not without a drawback.
Imagine holding a token representing a fractionalized form of land, gold, or fine arts that you purchased, but there’s no buyer for the same when you want to sell it. That’s a perfect wild-wild west scenario when trading tokenized RWAs, and so far $21 billion in tokenized RWAs (excluding stablecoins) are already in circulation, and they would be clocking $10T at 54X speed in the next 5 years as per CoinTelegraph report.
The need of the hour is to provide a safe ground for trading them in a scalable manner without diluting compliance. But the problem is that traditional platforms couldn’t accommodate them due to their inability to justify them as a security or a commodity or understand these innovations. That said, how can the next trillion dollar RWA with such an innovative approach meet mainstream adoption.
Alternate Trading Systems on blockchains is the answer for the same. In this blog, we shall see what they are, where RWAs are lagging due to their absence and how they can solve RWAs problems in meeting with the next level of adoption.
An Alternate Trading System (ATS) is a compliant trading venue built to handle assets that traditional exchanges couldn’t accommodate. Unlike stock exchanges, an ATS is registered as a broker-dealer, giving them the flexibility to define and support new forms of innovation.
On blockchains, ATSs make it possible to trade tokenized assets and RWAs within a regulated setup. They offer three things traditional markets fall short on:
In the US, there are certain laws to take into consideration like the Bank Secrecy Act, Suspicious Activity Reports (SARs) for RWA. Likewise, in Dubai, there’s VARA guiding Asset-Referenced Virtual Assets (ARVA) for RWA issuance. Europe, Germany, EU and other regions have their own rules.
In all these regions, if you are launching RWAs, you need to meet with these compliance or face consequences. But the problem with RWA is that it is very hard to classify them as a commodity or a security under these laws, thereby creating a lot of problems to list them on traditional exchange platforms. For example, Binance offered tokenized exposure to equities in 2021 but it was barred from operations because of their inability to meet compliance standards
Liquidity is a key problem when you are tokenizing RWAs like bonds, real-estate and equity because there’s no initial investor interest, promoter backing them and any specific trading mechanism in place that can monitor its price to drive the demand instantly.
Due to this problem, it is very hard to mark a price for any RWA asset when they are hitting any platform for trade. For example, the ReaIT RWA project experienced the same problem when they started trading on Uniswap because the Bid-Ask price was too thin causing significant revenue losses for the traders holding the ReaIT RWA tokens. These are the problems that create a non defined liquidity barrier obstructing adoption of such projects.
Slow settlement is another major problem which RWAs are facing at the moment because they are getting increasingly concentrated in a single ecosystem with very few buyers/ sellers to drive the demand/supply equilibrium.
As a result of this, most of the tokens have almost hit floor prices because they cannot tap into other ecosystems when they do not have adequate demand on their own. Harbor, a RWA project, was forced to shut down because the platform was not interoperable with other ecosystems to tap their user base and amplify the demand for the tokens.
When Alternate Trading Systems are built on top of blockchains, they can provide various tradeoffs like access controls, verification, audits, peer-to-peer trading of RWA tokens with KYC/AML.
Due to this, it can solve many problems through programmable compliance and allow banks, institutions and even brokers to access the RWA segment; thereby creating a perfect demand/supply equilibrium.
Due to the ATS on blockchains, it would be easier to build DeFi rails together with WallStreet compliances as well to help RWA go mainstream for adoption.
Projects like ReaIT failed because it was confined to a single ecosystem but when you are using ATS on blockchains, it is possible to enjoy the secondary market trading for tokenized assets beyond your native territory.
Because you can tap into dark pools for liquidity where institutions, retailers and even banks dwell. Thereby, allowing these institutions to participate when they know that they will not face unwanted slippage problems and at the same time, they can even meet unlimited throughput and validate all the tokens which are available for trade even though they are coming from different ecosystems.
The problem with RWA tokens is that you do not get an instantaneous matching experience because most RWAs are operational within closed boundaries. But with the help of ATS on blockchains, it is possible to experience near atomic transfers and a unified orderbook to experience better trading experience beyond a single ecosystem. But how would that happen, if you may ask? Because blockchains will be helping you tap into a wider ecosystem through bridges and wrapped tokens to meet a near instantaneous settlement experience.
Aspen St. Regis Resort wanted to tokenize their resort for ownership and participation. In this regard, a compliant ATS on blockchains helped them operate with rules and allow a democratized participation to make their illiquid property turn liquid for expansion and other purposes.
Diamond Standard Fund took a move to tokenize their diamond holdings in a compliant manner to ensure that investors can easily participate in their tokenized diamond token auctions. For that matter, they created the InvestaX’s as a blockade powered ATS to allow not just the US investors to participate but even tap into the Asian market.
There is fetish among people for luxury cars but not everyone can manage to afford them. Citing this as an opportunity, CurioInvest created their own ATS platform on blockchain to sell tokenized representatives of their luxury cars. Due to the compliant nature of the ATS platform on blockchains, they were able to sell the Curioinvest luxury car tokens in a compliant manner and even opened doors for a large investor base to participate.
In the next few years, RWAs will be defining how we can interact with rare items like arts, collectibles, and valuable commodities like gold, platinum and silver. So, if you want to create a market for such luxurious items and you need someone to help you do that in a compliant manner, we can help you.
Prolitus has over a decade of experience building on top of blockchains various platforms from Dapps, marketplaces, exchanges to gaming apps. If you want to build your own ATS platform on blockchains for RWAs, Prolitus can help in this regard.
So far, we have served many projects in the Web 3 gaming, NFTs, Dex and exchange segments. By using our seasoned professionals having years of experience, we have provided the best outcomes to all the clients served. If you are looking for similar expertise, innovation, and comprehensive support to build your ATS marketplace on blockchains for RWAs from the scratch in a completely frictionless manner, we are here to help you. For queries about how we can streamline the process and help you in developing your compliant ATS on blockchain for RWAs, we are just a call away from you.
