Tokenization Has Scaled Faster Than Liquidity
Real-world asset tokenization has moved from fringe idea to serious market category. The sector grew from roughly $5 billion in 2022 to over $36 billion by late 2025, a sevenfold increase in three years. Analysts project the market could reach $18.9 trillion by 2033, according to BCG and Ripple forecasts.
Those numbers get attention, and they should. But I have found that owners often hear "tokenization" and mentally substitute the word "liquidity." That is where expectations start to drift. Creating a digital wrapper around ownership is one thing. Creating a market where someone can actually sell that position at a fair price is something else entirely.
Rischan Mafrur of Macquarie University made that distinction unavoidable in his 2025 paper, "Tokenize Everything, But Can You Sell It?" The paper is valuable because it looks past the issuance announcement and asks the only question that matters after launch: can the asset trade?
What the On-Chain Data Actually Shows
Mafrur's analysis uses data from RWA.xyz and Etherscan to examine what happens after assets are tokenized. Four patterns stand out, and none of them look like the frictionless market many people imagine.
Market cap does not guarantee trading activity. BlackRock's BUIDL fund, the largest tokenized RWA at nearly $2 billion, had only 85 unique holders and 30 monthly active addresses as of mid-2025. Paxos Gold (PAXG), meanwhile, had a smaller market cap but more than 69,000 holders. Bigger is not the same as more liquid.
Most tokenized assets barely trade after purchase. On RealT, one of the earliest tokenized real estate platforms, token ownership changed hands on average only once per year. By any standard, that qualifies as illiquid. Closer to buy-and-hold than anything resembling a traded market.
Transfer activity is episodic. Most institutional tokens showed longest active streaks of only 3-13 days. Activity tends to spike during issuance and redemption windows, then fade. The token exists, the legal wrapper exists, but continuous market participation often does not.
Many platforms are excellent at onboarding and weak at exits. Most RWA protocols still prioritize primary issuance and asset onboarding over secondary liquidity. Maple facilitates tokenized loan origination but lacks integrated exit mechanisms. RealT restricts trading to platform-managed OTC channels. That can work, but it is not the same as deep two-sided trading.
Why RWA Liquidity Still Breaks Down
The research points to five reinforcing barriers, and in practice they compound each other.
Fragmented marketplaces. There is no central exchange for RWA tokens where serious buyers, serious sellers, and credible price discovery all meet in one place.
Regulatory gating. Accredited investor requirements narrow the buyer pool. That may be appropriate from a compliance standpoint, but it still reduces turnover.
Valuation opacity. A one-of-one asset does not have the pricing clarity of Apple stock or a Treasury bill. If the underlying asset is a 47-carat Paraiba tourmaline, a rare sculpture, or a 200-acre mineral rights parcel in the Permian Basin, valuation often feels more like negotiation than consensus.
Absence of market makers. Without dedicated participants quoting both sides of the market, every sale can become a custom transaction.
Technological friction. Wallet setup, gas fees, and cross-chain incompatibility are still enough to lose otherwise interested buyers, especially institutional buyers who are not looking for operational novelty.
The Infrastructure Gap Is Starting to Close
The thesis still holds. What's missing is market structure, not token issuance.
There were meaningful signals in late 2025 and early 2026. The Depository Trust Company received SEC approval to offer tokenization services. Nasdaq has proposed rule changes to enable tokenized securities trading. MakerDAO has integrated over $2 billion in tokenized assets as collateral for its DAI stablecoin. The SEC's January 2026 statement also gave the market clearer guidance on how tokenized securities fit within existing regulatory frameworks.
That matters because liquidity usually arrives after legal clarity, institutional participation, and standardized infrastructure show up together. Technology alone rarely gets it there.
What Asset Owners Should Take From This
If you are considering tokenization for a high-value physical asset, the tech works. That part is settled. What matters now is what kind of liquidity timeline is realistic for your asset, with your buyer pool, under your regulatory constraints.
In practical terms, that means planning for slower exits than a marketing deck may imply. It means asking whether a hybrid approach, such as tokenization combined with collateral-based lending or broker channels, gives you more flexibility. And it means investing heavily in evidence: GIA certification, independent appraisals, and on-chain proof of reserve. The research keeps circling back to the same point. When investors cannot trust valuation, they hesitate.
Tokenization is a better ownership rail. It can be a better transfer rail. It can absolutely become a better governance rail. But it is not a shortcut to liquidity, at least not yet. The opportunity is real, but the smarter posture today is optimism with discipline.