Tokenization Offers New Opportunities, but Real-World Asset Supply Outpaces Investor Demand, Industry Leaders Warn

Tokenized assets are rapidly expanding their footprint across global financial markets, unlocking innovative trading avenues for traditional and digital investors alike. However, this growing supply of real-world assets (RWAs) being brought onchain has yet to be matched by commensurate investor demand, according to prominent market executives.

The disconnect between tokenized asset creation and active market participation took center stage during a panel discussion on liquidity and market fragmentation at CONNECT by Cointelegraph: Singapore Edition on Oct. 9. Speaking at the event, Alex Taaffe, chief revenue officer at prominent crypto trading firm GSR, noted that while liquidity is visibly improving in sectors like pre-IPO stocks, commodities, and global equities—asset classes that historically offered limited access to retail and mid-tier participants—the broader demand for fully tokenized RWAs continues to lag behind the sheer volume of assets being issued.

The event itself served as a major convergence point for the digital asset industry, bringing together Web3 founders, institutional investors, and senior corporate executives for a series of high-level panel discussions. Over the course of the gathering, participants dissected critical pillars of the modern digital economy, including asset tokenization, stablecoin payments, onchain trading infrastructure, and venture capital exits, alongside a dynamic startup pitch competition designed to showcase early-stage innovation.

Addressing the structural state of tokenized markets, Taaffe pointed directly to a fundamental macroeconomic imbalance currently plaguing the sector. Specifically regarding RWAs and fully tokenized assets, he highlighted a stark supply and demand discrepancy, explaining that a vast amount of supply is being generated because virtually every asset manager and issuer wants to execute capital formation directly onchain.

Compounding this imbalance is the sheer proliferation of issuing platforms and underlying blockchain networks. Taaffe noted that the growing number of distinct asset issuers and fragmented blockspace environments has further exacerbated liquidity fragmentation across tokenized markets, making it increasingly difficult for capital to pool efficiently.

Lingling Jiang, a partner at DWF Labs, echoed these concerns during the panel, agreeing that fragmentation remains one of the most stubborn hurdles facing the industry. Jiang emphasized that the problem is particularly acute when multiple independent issuers tokenize the exact same underlying asset, inadvertently creating isolated, competing liquidity pools rather than a unified, deep market. Despite these structural inefficiencies, Jiang offered an optimistic macro perspective, pointing out that overall cryptocurrency liquidity has improved significantly over recent years, even as the industry acknowledges that considerable work remains to be done to achieve institutional-grade integration.

Stablecoin Adoption Hinges on Everyday Payments

Moving from asset tokenization to the realm of transactional currency, the panel titled “Stablecoins at the Point of Sale: Cards, Wallets and the Race for Everyday Spend” tackled the ongoing evolution of digital cash. Mike Silagadze, founder and CEO of decentralized finance protocol ether.fi, argued that while stablecoins have undeniably revolutionized cross-border capital mobility and wholesale settlement, their broader, mass-market adoption ultimately hinges on whether everyday consumers can seamlessly utilize them for routine, day-to-day expenses.

Silagadze drew attention to developed financial hubs like Singapore, where a tech-savvy consumer might hold digital dollars such as USDC in a Web3 wallet, yet still find themselves forced to rely on legacy local currency to pay ordinary utility bills or purchase groceries. This friction, he suggested, perfectly encapsulates the persistent gap separating advanced blockchain payment infrastructure from mundane, everyday financial services.

Echoing this user-centric sentiment, Yvonne Chia, head of communications at USDD, stressed that stablecoin issuers must anchor their product development strategies in the direct perspective of the end user. According to Chia, prioritizing user experience is the single most critical vector for growth. The ultimate strategic direction for the industry, she explained, is to make acquiring, holding, and spending stablecoins so frictionless that it ceases to be a conscious decision for the user, blending invisibly into the background of their regular financial lives.

Reinforcing the point regarding practical utility, Silagadze reiterated that the primary reason stablecoins remain underutilized for local commerce in many parts of the world is simply that they fail to plug naturally into everyday life routines.

Beyond user experience hurdles, the path to mainstream integration is further complicated by a complex web of regulatory frameworks. Ilya Podoynitsyn, co-founder and CEO of FinHarbor, highlighted the compliance burdens facing payment providers, noting that firms must constantly navigate shifting rules that vary wildly from one jurisdiction to another. This regulatory fragmentation forces companies to continuously adapt their underlying infrastructure and compliance systems to satisfy individual regional markets.

Adding to the discussion on user friction, Ashna Vaghela, chief customer officer at crypto payments provider Mercuryo, argued that next-generation stablecoin payments should strive to achieve the same effortless simplicity as mainstream consumer fintech tools like Apple Pay, allowing users to execute transactions instantaneously without ever needing to navigate away from an active application. Vaghela summarized the ultimate design philosophy for the sector, stating that the whole point of modern payment infrastructure is to be completely invisible to the user.

This renewed focus on practical utility arrives as the broader stablecoin market cap hovers around $306 billion, reflecting a modest year-over-year increase of about 2% following a staggering 74% growth surge during the preceding 12-month cycle.

Onchain Trading Faces Liquidity Fragmentation and Risk Management Challenges

As digital asset markets continue to mature, crypto trading platforms are increasingly grappling with systemic challenges related to locating genuine liquidity across disparate blockchain networks and managing complex counterparty risks. These themes dominated the panel titled “What’s Still Missing in the Onchain Trading Stack in 2026.”

Austin Federa, co-founder of DoubleZero, pointed out that transferring and aggregating liquidity between separate blockchain networks remains significantly more difficult than in traditional, legacy financial markets. Describing the operational bottleneck, Federa noted that fragmentation is not merely an execution problem, but fundamentally a data problem, adding that it is remarkably difficult to ascertain with absolute precision how much liquidity genuinely exists onchain at any given moment.

On the risk management front, Miguel Morel, founder and CEO of blockchain analytics firm Arkham Intelligence, explained how sophisticated trading firms are beginning to leverage transparent onchain data to accurately assess counterparty exposure. This capability is particularly vital in emerging sectors like prediction markets, where certain participants may possess asymmetric informational advantages over others.

According to Morel, knowing precisely who is on the other side of a trade allows institutions to take on calculated risks, enabling them to offer tighter spreads and ultimately deliver better pricing structures to end consumers. Furthermore, Morel noted that this exact same foundational blockchain data can empower centralized and decentralized exchanges alike to rigorously evaluate customer deposits. By analyzing transaction histories and tracing the origins of incoming funds, compliance departments can make informed decisions regarding asset legitimacy without resorting to intrusive manual checks. Morel pointed out that platforms can determine where incoming deposits originate without needing to ask for a passport, using the intelligence to decide whether trading should be permitted instantly or whether funds warrant a formal compliance review.

Crypto Investors Face Tougher Exits as Markets Mature

Shifting the lens from market structure to venture capital dynamics, panelists gathered for “The Exit Problem: How Investors Get Their Money Back” discussed how persistent liquidity constraints have significantly complicated liquidity events and exit strategies for early-stage crypto investors.

Pulkit Gupta of Nomad Capital observed that liquidity conditions within broader crypto markets have been particularly subdued over recent quarters, with the vast majority of available capital heavily concentrated within large-cap digital assets. Gupta admitted that for altcoins and smaller-cap tokens, securing clean, efficient exits has proven to be a genuinely difficult endeavor, despite Nomad Capital having backed several prominent projects with publicly traded native tokens, including Movement, Solayer, and Berachain.

Sonia Shaw, CEO of OneAsset, offered a complementary perspective on the shifting expectations within the venture ecosystem, noting that the market has evolved past the speculative excesses of previous cycles and now demands that early-stage startups demonstrate robust, verifiable business fundamentals. Recalling an era when certain investors routinely anticipated rapid liquidity events within a matter of months, Shaw asserted that the market simply does not operate that way anymore, characterizing the departure from hyper-fast, speculative exits as a healthy and welcome sign of overall market maturity.

Aleksandr Nechaev, partner at Funders VC, underscored the operational hurdles introduced by the breakneck pace of technological and market evolution, noting that the sheer speed of change places an extraordinary premium on the personal expertise and adaptability of founding teams when evaluating investment opportunities. The realities of navigating market uncertainty and backing resilient leadership teams emerged as central themes later in the day during the event’s live startup pitch competition, which was powered by Funders VC to highlight the next wave of industry talent.