The broader tokenization market, including stablecoins, has grown roughly 60% year-over-year to reach approximately $321 billion, according to a Q1 2026 report from Pantera Capital. But the firm argues that most of that growth masks a structural problem: the vast majority of tokenized assets are not meaningfully different from the traditional instruments they represent.

Pantera scored 542 tokenized assets on a spectrum from "wrapper" to "native on-chain," finding that 77.6% fall into the wrapper category. A wrapper token is essentially a blockchain receipt for an asset that continues to be held and managed through conventional, intermediary-controlled systems. It adds a layer of programmability in theory, but in practice it does not unlock the programmable compliance, autonomous collateral management, real-time yield optimization, embedded governance, or asset unbundling that blockchain infrastructure makes possible. The firm compared this to early internet-era newspapers that posted PDFs online rather than building interactive, hyperlinked publications. They digitized the format without using the medium.

The numbers behind the headline figure reinforce the point. Stablecoins alone account for 91.6% of the total tokenized market value, meaning the more widely cited $321 billion figure rests almost entirely on one asset class. Strip out stablecoins, and the remaining on-chain real-world asset market sits somewhere between $26 billion and $36 billion, up from roughly $6.6 billion a year earlier. That fourfold increase is genuinely significant, but it is a different story than the headline implies. Additionally, 91% of tokenized assets still require gated issuance and redemption, meaning investors must pass through institutional compliance intermediaries rather than accessing instruments directly on-chain, a constraint that critics of the current market argue tokenization was intended to reduce.

Pantera's report acknowledges that wrappers are not simply a failure of ambition. "For many institutions, [wrappers] are a practical first step because they fit familiar compliance and operating models while improving distribution and access," the report states. The firm's managing partner, Paul Veradittakit, separately identified RWA tokenization as one of three crypto use cases showing genuine product-market fit in 2025, alongside stablecoins and prediction markets. Major institutions have committed real capital: BlackRock's BUIDL fund holds $1.9 billion in tokenized Treasuries across six chains, Franklin Templeton's BENJI fund manages $680 million on Stellar, Polygon, and Solana with yields between 4.3% and 4.6%, and JPMorgan's Kinexys platform (formerly Onyx) has processed more than $900 billion in tokenized repo transactions and is now settling tokenized Treasuries on public chains, a development that bears directly on the wrapper-versus-native distinction. These are wrapper-class instruments, but the institutional scale is no longer speculative.

The wrapper critique carries particular weight in South Asia and Africa, where the asset classes and populations most likely to benefit from tokenization are not well served by US Treasury receipts on Ethereum. In Kenya, the Nairobi Securities Exchange is building the Kenya Digital Exchange, a regulated platform specifically for tokenized real-world assets. The Capital Markets Authority has already admitted Yeshara Tokens Limited into its regulatory sandbox to test blockchain-based real estate tokenization. The NSE's chief executive said the exchange aims to "unlock new investment opportunities, deepen market access, and position Kenya as a trailblazer in tokenization." In Nigeria, the state of Lagos has announced plans to tokenize real estate with an explicit focus on retail inclusion, giving ordinary residents fractional access to city property without requiring bank financing. In India, the GIFT City financial zone issued a formal regulatory consultation paper in March 2025 covering tokenized asset issuance, custody, trading, and AML compliance. The first regulated RWA product within the GIFT City sandbox, a tokenized real estate fund built by Terazo on Polygon, launched in January 2024, predating that consultation paper. Broader guidance from India's domestic securities regulator, SEBI, is not expected until late 2026 or 2027 at the earliest.

Jesse Knutson, head of operations at Bitfinex, argued in December 2025 that this regional lag could become an advantage. "Emerging markets also tend to leapfrog infrastructure that holds back developed markets, adopting digital rails, including stablecoin settlement, faster than markets with entrenched legacy plumbing," he said. RWA lending protocols are already operating in this space, routing credit to fintech lenders across Africa, Southeast Asia, and Latin America at yields of 10% to 17% for DeFi participants. That is a functioning, revenue-generating use case, not a pilot.

Long-range forecasts for the sector vary widely. McKinsey projects the tokenized RWA market reaching roughly $2 trillion by 2030. Research and Markets puts the same 2030 figure at $9.43 trillion, implying a 72.8% compound annual growth rate. A joint study by Ripple and BCG projects $18.9 trillion by 2033, up from an estimated baseline of approximately $0.6 trillion in 2025, a trajectory that implies a 53% compound annual growth rate. The divergence across those projections reflects genuine differences in methodology and scope, as well as uncertainty about how quickly regulatory frameworks will evolve to permit more native, less intermediary-dependent instruments. What the Pantera report makes clear is that the current market, despite its growth, has not yet answered that question. Veradittakit has predicted that tokenized Treasuries, private credit, and tokenized equities could each at least double in 2026. Whether they do will depend on concrete milestones including the maturation of Kenya's Digital Exchange, the trajectory of SEBI's domestic framework, and whether the institutions currently issuing wrapper-class products begin building instruments that use the medium rather than merely digitizing the format.