Key Takeaways
- KAIO and Swarm have both expanded their tokenized RWA platforms to Hedera.
- In the early days of the technology, Ethereum dominated RWA tokenization.
- Alternative platforms like Hedera are increasingly competing for a share of the RWA market.
Recent launches by tokenization engines KAIO and Swarm suggest Hedera (HBAR) may be gaining traction as a real-world asset (RWA) platform.
This development comes as the market for tokenized RWAs is projected to reach up to $30 trillion by 2034, and pretty much every blockchain is vying for a piece of the action.
Swarm Launches Stock Tokens on Hedera
Launched in 2021, Swarm is a small but pioneering investment platform that offers access to tokenized stocks and bonds, ETFs and gold.
As major players like Robinhood have entered the space, Swarm’s model continues to stand out for several key reasons.
Firstly, Swarm’s stock tokens are issued under Germany’s regulatory framework, granting investors greater protection in the case of insolvency.
Moreover, the platform lets users redeem their tokens for the underlying shares, a key feature many of its peers lack.
Initially, Swarm supported tokenized RWAs on Ethereum (ETH), Solana (SOL), and Polygon (POL). On Friday, Aug. 15, the company announced its expansion to Hedera.
“We chose to work with Swarm because of their regulatory credibility and technical readiness to make tokenized stocks usable across DeFi,” Hania Othman, Director of Financial Markets and Sustainability at The Hedera Foundation said in a statement shared with CCN.
Referencing Swarm’s redemption mechanism, she praised it as “a novel user-centric solution that creates true exit liquidity.”
KAIO Expands RWA Tokenization
The second platform that announced its expansion to Hedera this week is KAIO, a joint venture between WebN Group and Nomura’s Laser Digital formerly known as Libre.
For the launch, three funds—the Laser Digital Carry Fund, BlackRock’s ICS U.S. Dollar Liquidity Fund, and the Brevan Howard Master Fund—have been tokenized on Hedera.
The three funds, one focused on digital assets, one a money market fund, and one a managed hedge fund, reflect KAIO’s investment philosophy, which focuses on tokenizing diverse products from institutional asset managers.
Scrambling for RWA Dominance
In the early days of tokenization, Ethereum dominated, and it continues to maintain the largest market share, accounting for around 54% of the overall RWA market.
However, with its limited throughput and high gas fees, there is a growing consensus that the Ethereum mainnet isn’t best-placed to scale the concept.
In the past year, rival networks have made inroads in the space, with Hedera among a crop of more efficient alternatives to Ethereum jostling to become the platform of choice for RWA tokenization.
These include dedicated RWA chains like Canton Network and Plume, which are custom-built to support tokenization.
Meanwhile, established players like Ripple are already looking to the technology’s next stage.
With the wrapped RWA model that currently dominates currently spreading across diverse networks, Ripple executive Markus Infanger recently expressed his view that native issuance is the real opportunity.
Although he acknowledged that platforms like Swarm and KAIO provide an important stepping stone, Infanger argued that the true potential of tokenization lies in blockchain-native assets.
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James Morales is CCN’s blockchain and crypto policy reporter. He has been working in the news media since 2020, writing about topics such as payments, banking and financial technology. These days, he likes to explore the latest blockchain innovations and the evolving landscape of global crypto regulation.
With an educational background in social anthropology and media studies, James uses his platform as a journalist to explore how new technologies work, why they matter and how they might shape our future.
