Decentralized finance (DeFi) could soon experience a monumental upheaval, which may see it increasingly replace traditional finance (TradFi). A recent report by Standard Chartered projects that tokenized real-world assets (RWAs) held on DeFi platforms will reach $2 trillion by 2028 — representing an astounding increase from current levels. CoinDesk cannot guarantee these figures are correct.
An onslaught of tokenised assets are now flooding markets worldwide.
Standard Chartered research shows that tokenized asset markets – securities, funds, real estate and debt instruments – have become mainstream segments of financial infrastructure. According to estimates by Standard Chartered’s estimates of non-stablecoin tokenised assets could grow from approximately $35 billion today to $2 trillion within three years.
CoinDesk Digging deeper, tokenised money-market funds and listed equities alone could each command approximately $750 billion by 2028, while private equity, commodities, corporate debt and real estate would contribute the remainder. What’s driving this surge?…
Standard Chartered has identified a self-reinforcing liquidity cycle within DeFi:
The recent surge in stablecoins has produced substantial on-chain liquidity. That allows more innovation in lending, borrowing and tokenized assets.
DeFi platforms’ improved access and transparency attract more users and capital — further strengthening the cycle.
DeFi is now moving beyond niche crypto-native use cases and into challenging core TradFi functions such as payments, savings, asset issuance and trading via different architectural features (blockchain, smart contracts, open rails). Standard Chartered has acknowledged this shift by noting that DeFi no longer remains “just an experiment”, but has instead become “an alternative financial architecture”. Likewise CoinDesk highlights its significance by saying DeFi has now evolved from mere crypto experimentation towards competing core functions of TradF.
What this means for traditional finance
Existing banks, asset managers and infrastructure providers need only look at this $2 trillion forecast as a wakeup call: Tokenisation promises enormous potential returns.
Assets previously hard to access (e.g. real estate or private debt) may now become easier to acquire through fractional ownership arrangements (e.g. real estate and private debt).
24/7 Trading and Settlement with Fewer Intermediaries
Enhance transparency and ensure smoother integration of digital rails
TradFi players face disruption: as large capital flows shift into tokenised ecosystems, traditional roles of banks and custodians may need to change rapidly in response to new needs arising from tokenised assets; device services, fee models, and regulatory alignment will likely all need to adapt rapidly in response.
Roadblocks and risks lie ahead.
Even though bullish projections exist, there are risks and caveats:
Regulatory Clarity: According to CoinDesk’s report, U.S. regulatory delays pertaining to tokenised securities and crypto rails remain the largest risk to its forecast.
Liquidity & Tradability: Although tokenised assets exist on-chain, their secondary markets and deep liquidity remain uneven – academic research indicates these tokenised assets often trade at lower volumes than expected.)
arXiv Operational Maturity & Market Confidence: For institutional investors to commit hundreds of billions into tokenised structures, their custody, settlement, governance and transparency standards must match that of Traditional Finance (TradFi).
Prospect of Transformative Change and its Nuances
By 2028, DeFi and tokenisation could form an independent ecosystem — not simply incremental growth. A $2 trillion valuation suggests tokenised assets could approach major segments of global financial markets.
DeFi advocates view tokenisation as a mark of legitimacy and maturity; for TradFi incumbents it signifies an urgent need to adapt or face displacement. But its path will not necessarily follow an orderly trajectory — regulatory developments, institutional adoption and infrastructure buildout all will play an integral part in how quickly or widely tokenisation becomes mainstream.
Standard Chartered’s projection highlights how tokenised assets and DeFi are shifting from promise to reality, with challenges still present but with structural forces like stablecoin liquidity, digital rails, and global reach suggesting that by 2028 the financial landscape could look vastly different than what it does today.
