Tokenized assets are rapidly opening up fresh trading opportunities across global financial markets, yet the accelerating supply of real-world assets (RWAs) being brought onchain has yet to be met by a corresponding wave of investor demand. This structural mismatch is creating distinct headwinds for capital formation across the burgeoning digital asset ecosystem, according to industry leaders addressing institutional liquidity and market structure at recent high-level forums.
Speaking during a panel discussion focused on liquidity and market fragmentation at the CONNECT by Cointelegraph: Singapore Edition event on Oct. 9, Alex Taaffe, chief revenue officer at prominent crypto trading firm GSR, detailed the evolving dynamics of modern asset tokenization. Taaffe noted that while liquidity is gradually improving in specific corners of the market—such as trading for pre-IPO stocks, commodities, and various global equities that were once notoriously difficult for retail and smaller institutional investors to access—the broader demand for fully tokenized RWAs simply has not kept pace with the sheer volume of assets being issued by eager financial institutions.
The Cointelegraph-hosted event gathered an array of Web3 founders, institutional investors, and senior industry executives to participate in four comprehensive panel discussions. These sessions explored critical sectors of the digital economy, including advanced tokenization models, stablecoin payment systems, next-generation onchain trading infrastructure, and venture capital exit strategies. The conference also featured a competitive startup pitch competition designed to spotlight emerging talent in the blockchain space.
Elaborating on the primary friction points in the current market environment, Taaffe pointed directly to the mechanics of the issuance sector. "Specifically on RWAs, and fully tokenized assets, there’s a supply and demand imbalance. There’s a ton of supply. Every asset manager issuer wants to do capital formation onchain," Taaffe told the audience. He further explained that as an increasing number of asset issuers rush to market across a proliferating array of distinct blockchain networks, the overall liquidity pool is becoming progressively fractured, complicating efficient price discovery and smooth trade execution.
Lingling Jiang, a partner at DWF Labs, echoed these concerns, emphasizing that market fragmentation remains an enduring hurdle for the industry. Jiang noted that the problem is particularly acute when multiple independent issuers choose to tokenize the exact same underlying asset, inadvertently splitting potential buyers across isolated liquidity pools rather than unifying them under a single deep market. Despite these structural inefficiencies, Jiang acknowledged that general cryptocurrency liquidity has advanced significantly over the past several years, even as the sector continues to grapple with the complexities of scaling its infrastructure.
Stablecoin Adoption Hinges on Everyday Payments
While tokenized assets tackle capital formation and investment portfolios, stablecoins are increasingly setting their sights on the mechanics of transactional commerce. During a separate panel titled "Stablecoins at the Point of Sale: Cards, Wallets and the Race for Everyday Spend," industry leaders debated the distance between current blockchain utility and mass consumer adoption. Mike Silagadze, founder and CEO of ether.fi, argued that while stablecoins have undeniably revolutionized the speed and efficiency of moving money across international borders, true mainstream adoption ultimately depends on whether ordinary consumers can effortlessly utilize them for daily expenses.
Silagadze highlighted the real-world friction still present in advanced financial hubs like Singapore. In such environments, a tech-savvy consumer might comfortably hold digital dollars such as USDC in a Web3 wallet, yet they still find themselves relying on traditional local fiat currency to settle standard utility bills or buy groceries. This daily reality exposes a persistent gap between cutting-edge blockchain payment infrastructure and the seamless expectations of everyday financial services.
Echoing this user-centric perspective, Yvonne Chia, head of communications at USDD, emphasized that true progress requires prioritizing the end-user experience above all else. "That’s the kind of direction that we want to move in, to make it as easy as possible for the user to have stablecoins, use stablecoins, to the point where it doesn’t cross their mind that they are using a stablecoin. It’s just a regular part of their lives," Chia explained.
Silagadze reiterated that the primary reason stablecoins remain underutilized for day-to-day purchases in many regions is simply that they fail to plug naturally into a person’s routine. Compounding these usability challenges are regulatory hurdles. Ilya Podoynitsyn, co-founder and CEO of FinHarbor, pointed out that digital asset service providers are continually forced to navigate a patchwork of disparate rules across international jurisdictions. This regulatory fragmentation requires firms to constantly adapt their underlying compliance and technical infrastructure to satisfy the specific demands of individual regional markets.
Looking toward a more streamlined future, Ashna Vaghela, chief customer officer at crypto payments provider Mercuryo, suggested that stablecoin transactions should eventually match the frictionless nature of mainstream payment rails like Apple Pay. The ultimate objective, Vaghela noted, is complete invisibility, allowing users to complete complex financial transactions smoothly without ever needing to navigate away from their primary application interface.
These discussions unfolded against a backdrop of substantial macroeconomic scale for the sector, with the global stablecoin market capitalization standing at approximately $306 billion. This figure reflects a steady 2% expansion year over year, following a massive 74% growth surge observed over the preceding twelve-month cycle.
Onchain Trading Faces Liquidity Fragmentation and Risk Management Challenges
As trading activity increasingly shifts to decentralized and onchain environments, participants continue to confront systemic hurdles related to tracking dispersed liquidity and evaluating counterparty exposure. During a panel session exploring "What’s Still Missing in the Onchain Trading Stack in 2026," market participants analyzed the technical roadblocks still hindering institutional participation.
Austin Federa, co-founder of DoubleZero, noted that routing and moving liquidity seamlessly between disparate blockchain networks remains significantly more difficult than in traditional, legacy financial markets. Describing the core issue, Federa stated that "fragmentation is not just an execution problem, it’s like a data problem," adding that "it’s actually very hard to figure out how much liquidity truly exists onchain."
On the risk management front, Miguel Morel, founder and CEO of blockchain analytics firm Arkham Intelligence, explained how advanced onchain data tools can help trading firms accurately assess counterparty risk. This is particularly valuable in emerging sectors like prediction markets, where certain participants frequently hold informational advantages over others. "If you know who’s on the other side and you’re taking less risk, you can offer a tighter spread," Morel observed, noting that this transparency ultimately results in more competitive pricing for everyday customers.
Furthermore, Morel pointed out that the same granular blockchain intelligence can assist modern exchanges in evaluating incoming customer deposits. By analyzing transaction histories, platforms can gain insight into the origin of funds to streamline regulatory compliance without resorting to invasive verification procedures. "Without needing to ask for a passport, you can know where those deposits are coming in from," Morel said, explaining how automated systems can leverage this data to determine whether deposited funds can be immediately cleared for trading or require further compliance review.
Crypto Investors Face Tougher Exits as Markets Mature
Beyond trading and retail payments, the evolving liquidity landscape has also complicated capital return timelines for cryptocurrency venture capital investors. Panelists participating in a session titled "The Exit Problem: How Investors Get Their Money Back" discussed how shifting macroeconomic conditions and market cycles are forcing a fundamental reassessment of venture-backed liquidity events.
Pulkit Gupta of Nomad Capital noted that secondary and primary market liquidity across the crypto ecosystem has experienced noticeable contractions over recent months, with available capital heavily concentrated primarily within the largest and most established cryptocurrencies. "For me, on the altcoins, it has been really tough for us to get an exit," Gupta admitted, noting the realities faced by a firm that has backed numerous notable crypto infrastructure projects featuring publicly traded tokens, including Movement, Solayer, and Berachain.
Reflecting a broader institutional shift toward sustainable business models, Sonia Shaw, CEO of OneAsset, emphasized that the digital asset market has matured past the hyper-speculative eras of the past. Startups are now expected to demonstrate robust and verifiable business fundamentals rather than relying solely on narrative momentum. Recalling an era when certain investors routinely anticipated rapid token liquidity and full exits within a matter of months, Shaw remarked that "I don’t think the market’s like that anymore," characterizing the normalization of longer investment horizons as a healthy sign of long-term industry maturation.
Concluding the dialogue on startup investment, Aleksandr Nechaev, partner at Funders VC, highlighted the unique operational challenges introduced by the relentless pace of technological evolution in the Web3 space. Nechaev noted that the sheer speed of change places a heavy emphasis on a founder’s personal expertise and adaptability when evaluating prospective investments. The importance of resilient founding teams and their capacity to navigate acute market uncertainty remained a central theme throughout the remainder of the day’s events, culminating in the conference’s featured startup pitch competition.
Crypto Startups & Venture Capital
Crypto Startups & Venture Capital
Crypto Startups & Venture Capital
