Institutional-level RWA Infrastructure 2026 Panorama: Five Major Protocols Restructuring a $20 Billion Market

Original Author: Mesh

Original Compilation: Deep Tide TechFlow

To be honest, the development of institutional-grade RWA (Real World Assets) tokenization over the past six months is worth close attention. The market size is approaching $20 billion. This is not hype; real institutional capital is being deployed on-chain.

I have been following this field for a while, and the recent pace of development is astonishing. From government bonds and private credit to tokenized stocks, these assets are transitioning to blockchain infrastructure faster than the market expected.

Currently, five protocols have become the foundation of this field: Rayls Labs, Ondo Finance, Centrifuge, Canton Network, and Polymesh. They are not competing for the same type of clients but are targeting different needs of institutions: banks require privacy, asset management companies pursue efficiency, and Wall Street firms demand compliance infrastructure.

This is not about who "wins," but about which infrastructure institutions choose and how traditional assets can achieve the migration of trillions of dollars through these tools.

The Overlooked Market Approaches $20 Billion

Three years ago, tokenized RWA was hardly considered a category. Today, the on-chain deployed assets of government bonds, private credit, and public stocks are nearing $20 billion. This growth is significant compared to the $6 billion to $8 billion range at the beginning of 2024.

To be honest, the performance of the sub-markets is more interesting than the total size.

According to a market snapshot provided by rwa.xyz at the beginning of January 2026:

Government Bonds and Money Market Funds: Approximately $8 billion to $9 billion, accounting for 45%-50% of the market
Private Credit: $2 billion to $6 billion (small base but fastest growth, accounting for 20%-30%)
Public Stocks: Over $400 million (growing rapidly, mainly driven by Ondo Finance)

Three Major Drivers Accelerating RWA Adoption:

Attractiveness of Yield Arbitrage: Tokenized government bond products offer a return rate of 4%-6% and support 24/7 access, while traditional markets have a T+2 settlement cycle. Private credit tools offer a return rate of 8%-12%. This is a straightforward calculation for institutional CFOs managing billions in idle capital.
Gradual Improvement of Regulatory Frameworks: The EU's Markets in Crypto-Assets Regulation (MiCA) has been enforced in 27 countries. The SEC's "Project Crypto" is advancing an on-chain securities framework. Meanwhile, No-Action Letters allow infrastructure providers like DTCC to tokenize assets.
Maturity of Custody and Oracle Infrastructure: Chronicle Labs has processed over $20 billion in total locked value, and Halborn has completed security audits for major RWA protocols. These infrastructures are mature enough to meet fiduciary standards.

Despite this, the industry still faces significant challenges. The cost of cross-chain transactions is estimated to reach $1.3 billion annually. Due to high capital flow costs exceeding arbitrage yields, the price difference for the same asset across different blockchains reaches 1%-3%. The conflict between privacy needs and regulatory transparency requirements remains unresolved.

Rayls Labs: The Privacy Infrastructure Banks Truly Need

@RaylsLabs positions itself as a compliance-first bridge connecting banks with decentralized finance (DeFi). Developed by the Brazilian fintech company Parfin and supported by Framework Ventures, ParaFi Capital, Valor Capital, and Alexia Ventures, its architecture is a public permissioned, EVM-compatible Layer 1 blockchain designed specifically for regulated entities.

I have been following the development of its Enygma privacy tech stack for some time. The key is not the technical specifications but its methodology. Rayls is addressing the real needs of banks rather than catering to the DeFi community's imagination of banking needs.

Core Features of the Enygma Privacy Tech Stack:

Zero-Knowledge Proofs: Ensuring transaction confidentiality
Homomorphic Encryption: Supporting computations on encrypted data
Native Operations Across Public Chains and Private Institutional Networks
Confidential Payments: Supporting atomic swaps and embedded Delivery-versus-Payment (DvP)
Programmable Compliance: Selectively disclosing data to designated auditors

Real-World Use Cases:

Central Bank of Brazil: Used for CBDC (Central Bank Digital Currency) cross-border settlement pilot
Núclea: Regulated accounts receivable tokenization
Multiple Unannounced Node Clients: Used for privatized payment delivery (DvP) workflows

Latest Developments

On January 8, 2026, Rayls announced the completion of a security audit conducted by Halborn. This provides institutional-grade security certification for its real-world asset (RWA) infrastructure, which is particularly important for banks evaluating production deployment.

Additionally, the AmFi Alliance plans to achieve a target of $1 billion in tokenized assets on Rayls by June 2027, with a reward of 5 million RLS tokens. AmFi is Brazil's largest private credit tokenization platform, bringing immediate trading volume to Rayls and setting a specific 18-month milestone. This is one of the largest institutional RWA commitments obtained in any blockchain ecosystem to date.

Target Market and Challenges

Rayls' target clients are banks, central banks, and asset management companies that require institutional-grade privacy. Its public permissioned model restricts validator participation to licensed financial institutions while ensuring the confidentiality of transaction data.

However, the challenge for Rayls lies in proving its market appeal. In the absence of publicly available TVL (Total Value Locked) data or announced client deployments beyond pilots, the $1 billion AmFi target by mid-2027 becomes a critical test.

Ondo Finance: The Race for Cross-Chain Expansion

@OndoFinance has achieved the fastest expansion from institutional to retail in the RWA (Real World Assets) tokenization space. Starting with a focus on government bonds, it has now become the largest platform in the tokenized public stock sector.

Latest Data as of January 2026:

Total Value Locked (TVL): $1.93 billion
Tokenized Stocks: Over $400 million, accounting for 53% of market share
USDY Holdings on Solana: Approximately $176 million

I personally tested the USDY product on Solana, and the user experience was incredibly smooth: combining institutional-grade government bonds with the convenience of DeFi is the key.

Latest Updates

On January 8, 2026, Ondo launched 98 new tokenized assets at once, covering stocks and ETFs in areas such as artificial intelligence (AI), electric vehicles (EV), and thematic investments. This is not a small-scale trial but a rapid advancement.

Ondo plans to launch tokenized US stocks and ETFs on Solana in the first quarter of 2026, marking its most aggressive attempt to enter retail-friendly infrastructure. According to the product roadmap, the goal is to launch over 1,000 tokenized assets as expansion progresses.

Industry Focus:

Artificial Intelligence Sector: Nvidia, data center REITs
Electric Vehicle Sector: Tesla, lithium battery manufacturers
Thematic Investments: Special sectors traditionally limited by minimum investment thresholds

Multi-Chain Deployment Strategy

Ethereum: DeFi liquidity and institutional legitimacy
BNB Chain: Covering exchange-native users
Solana: Supporting large-scale consumer use with sub-second transaction finality

To be honest, while Ondo's token prices have fallen, the TVL has reached $1.93 billion, which is the most important signal: the protocol's growth takes precedence over speculative behavior. This growth is primarily driven by the demand for idle stablecoin yields from institutional government bonds and DeFi protocols. The increase in TVL during the market consolidation in Q4 2025 indicates real demand, not just chasing market trends.

By establishing custody relationships with broker-dealers, completing Halborn security audits, and launching products on three major blockchains within six months, Ondo has gained a competitive edge that rivals find hard to catch up with. For instance, its competitor Backed Finance has a tokenized asset scale of only about $162 million.

However, Ondo still faces some challenges:

Price Volatility During Non-Trading Hours: Although tokens can be transferred at any time, pricing still needs to reference exchange operating hours, which may create arbitrage price differences during US night trading hours.
Compliance Restrictions: Securities laws require strict KYC (Know Your Customer) and verification checks, limiting the narrative of "permissionless."

Centrifuge: How Asset Managers Are Truly Deploying Billions

@centrifuge has become the standard infrastructure for institutional-grade private credit tokenization. As of December 2025, the protocol's total locked value (TVL) has soared to $1.3 billion to $1.45 billion, driven by actual deployed institutional capital.

Key Institutional Deployment Cases

Janus Henderson Partnership (a global asset management company with $373 billion in assets under management)

Anemoy AAA CLO Fund: Fully on-chain AAA-rated collateralized loan obligations (CLO)
Uses the same portfolio management team as its $21.4 billion AAA CLO ETF
Announced expansion plans in July 2025, targeting an additional $250 million investment on Avalanche

Grove Fund Allocation (an institutional credit protocol in the Sky ecosystem)

Committed fund allocation strategy reaching $1 billion
Initial startup capital of $50 million
Founding team from Deloitte, Citigroup, BlockTower Capital, and Hildene Capital Management

Chronicle Labs Oracle Partnership (announced on January 8, 2026)

Proof of Asset framework: Provides cryptographically verified holding data
Supports transparent net asset value (NAV) calculations, custody verification, and compliance reporting
Offers dashboard access for limited partners (LPs) and auditors

I have been following the oracle issues in the blockchain space, and Chronicle Labs' approach is the first solution that meets institutional needs: providing verifiable data without sacrificing on-chain efficiency. The announcement on January 8 also included a video demonstration showing that this solution is already in practical use, rather than a future promise.

Centrifuge's Unique Operating Model:

Unlike competitors that simply package off-chain products, Centrifuge tokenizes credit strategies directly at the issuance stage. Its process is as follows:

Issuers design and manage funds through a single transparent workflow;
Institutional investors allocate stablecoins for investment;
Funds flow to borrowers after credit approval;
Repayments are proportionally distributed to token holders via smart contracts;
Annualized yield (APY) on AAA-rated assets ranges from 3.3% to 4.6%, with full transparency.

Multi-Chain V3 Architecture Supported Networks: Ethereum; Base; Arbitrum; Celo; Avalanche

The key is that asset managers need to prove that on-chain credit can support billions in deployment, and Centrifuge has already achieved this. The partnership with Janus Henderson alone provides billions in capacity.

Additionally, Centrifuge's leadership in industry standard-setting (such as co-founding the Tokenized Asset Coalition and the Real-World Asset Summit) further solidifies its position as infrastructure rather than a single product.

While the $1.45 billion TVL demonstrates institutional investment demand, the target annualized yield of 3.8% pales in comparison to higher-risk, higher-return opportunities historically found in DeFi. Attracting DeFi-native liquidity providers beyond the Sky ecosystem allocation becomes Centrifuge's next challenge.

Canton Network: Wall Street's Blockchain Infrastructure

@CantonNetwork is a response to the permissionless ethos of DeFi at the institutional level: a privacy-preserving public network supported by top Wall Street firms.

Participating Institutions

DTCC (Depository Trust & Clearing Corporation)
BlackRock
Goldman Sachs
Citadel Securities

Canton aims to target the $370 trillion annual settlement flow handled by DTCC in 2024. Yes, that number is correct.

DTCC Partnership (December 2025)

The partnership with DTCC is crucial. This is not just a pilot project but a core commitment to building the U.S. securities settlement infrastructure. By obtaining a No-Action Letter approval from the SEC, this partnership allows for the native tokenization of some U.S. Treasury securities held by DTCC on Canton, with plans to launch a controlled production MVP (Minimum Viable Product) in the first half of 2026.

Key Details:

DTCC and Euroclear jointly serve as co-chairs of the Canton Foundation;
Not just participants, but leaders in governance;
Initially focused on Treasuries (lowest credit risk, high liquidity, clear regulation);
After the MVP phase, may expand to corporate bonds, stocks, and structured products.

Initially, I was skeptical about permissioned blockchains. But the partnership with DTCC changed my perspective. This is not due to its technical superiority, but because it is the infrastructure that traditional finance will genuinely adopt.

Temple Digital Platform Launch (January 8, 2026)

Canton's institutional value proposition was further clarified with the launch of the private trading platform by Temple Digital Group on January 8, 2026. This platform is already live, not "coming soon."

Canton Network offers a Central Limit Order Book with sub-second matching speeds, utilizing a non-custodial architecture. It currently supports trading of cryptocurrencies and stablecoins, with plans to introduce support for tokenized stocks and commodities in 2026.

Ecosystem Partners

Franklin Templeton: Managing a money market fund valued at $828 million
JPMorgan: Achieving payment delivery (DvP) settlements through JPM Coin

Canton's Privacy Architecture

Canton's privacy features are contract-level, implemented using Daml (Digital Asset Modeling Language):

Contracts explicitly state which parties can see which data;
Regulators can access complete audit trails;
Counterparties can view transaction details;
Competitors and the public cannot see any transaction information;
Status updates are propagated atomically across the network.

For institutions accustomed to using Bloomberg terminals and dark pools for confidential trading, Canton’s architecture makes sense by providing blockchain efficiency while avoiding the public exposure of trading strategies. After all, Wall Street will never expose proprietary trading activities on a transparent public ledger.

Canton Network's over 300 participating institutions demonstrate its appeal in the institutional space. However, many of the reported transaction volumes may currently be more indicative of simulated pilot activities rather than actual production flows.

The current limitation lies in development speed: the MVP planned for delivery in the first half of 2026 reflects a multi-quarter planning cycle. In contrast, DeFi protocols typically launch new products within weeks.

Polymesh: A Securities Blockchain Network Born for Compliance

@PolymeshNetwork stands out through protocol-level compliance rather than the complexity of smart contracts. As a blockchain designed specifically for regulated securities, Polymesh conducts compliance verification at the consensus level without relying on custom code.

Core Features

Protocol-Level Identity Verification: Conducted through permitted customer due diligence (CDD) providers;
Embedded Transfer Rules: Non-compliant transactions fail directly at the consensus stage;
Atomic Payment Delivery (DvP): Transactions are completed with final confirmation within 6 seconds.

Production-Grade Integration

Republic (August 2025): Supporting private securities issuance;
AlphaPoint: Covering over 150 trading venues in 35 countries;
Target Areas: Regulated funds, real estate, corporate equity, etc.

Advantages

No need for custom smart contract audits;
The protocol automatically adapts to regulatory changes;
Non-compliant transfer operations cannot be executed.

Challenges and Future

Polymesh currently operates as an independent chain, which isolates it from DeFi liquidity. To address this issue, an Ethereum Bridge is planned for launch in the second quarter of 2026. Whether this can be achieved on schedule remains to be seen.

To be honest, I underestimated the potential of this "compliance-native" architecture. For security token issuers troubled by the complexities of ERC-1400, Polymesh's approach is indeed more attractive: embedding compliance directly into the protocol rather than relying on smart contracts.

How Do These Protocols Segment the Market?

These five protocols do not directly compete, as they each address different problems:

Privacy Solutions:

Canton: Based on Daml smart contracts, focusing on Wall Street counterparty relationships;
Rayls: Utilizing Zero-Knowledge Proofs, providing bank-grade mathematical privacy protection;
Polymesh: Protocol-level identity verification, offering a one-stop compliance solution.

Scaling Strategies:

Ondo: Managing $1.93 billion across three chains, prioritizing liquidity speed over depth;
Centrifuge: Focusing on the $1.3 billion to $1.45 billion institutional credit market, prioritizing depth over speed.

Target Markets:

Banking/CBDC → Rayls
Retail/DeFi → Ondo
Asset Management Firms → Centrifuge
Wall Street → Canton
Security Tokens → Polymesh

In my view, this market segmentation is more important than people realize. Institutions do not choose the "best blockchain," but rather the infrastructure that can address their specific compliance, operational, and competitive needs.

Unresolved Issues

Fragmentation of Cross-Chain Liquidity

The costs of cross-chain fragmentation are very high: estimated at $1.3 billion to $1.5 billion annually. Due to the high costs of cross-chain bridging, the same assets traded on different blockchains can incur a 1%-3% price discrepancy. If this issue persists until 2030, the annual cost is expected to exceed $75 billion.

This is one of my biggest concerns. Even if you build the most advanced tokenization infrastructure, if liquidity is scattered across incompatible chains, the efficiency gains will be nullified.

The Paradox of Privacy and Transparency

Institutions require confidentiality in transactions, while regulators demand auditability. In multi-party scenarios (such as issuers, investors, rating agencies, regulators, and auditors), each party requires different levels of visibility. Currently, there is no perfect solution.

Regulatory Fragmentation

The EU has passed MiCA (Markets in Crypto-Assets Regulation), applicable to 27 countries;
The U.S. requires case-by-case applications for No-Action Letters, taking months;
Cross-border capital flows face challenges of jurisdictional conflicts.

Oracle Risks

Tokenized assets rely on off-chain data. If data providers are attacked, the on-chain asset performance may reflect an incorrect reality. While Chronicle's Proof of Asset framework offers some solutions, risks still exist.

Path to Trillions: Key Catalysts for 2026

Catalysts to Watch in 2026:

Ondo's Solana Launch (Q1 2026)

Testing whether retail-scale distribution can create sustainable liquidity;
Success metrics: Over 100,000 holders, proving real demand exists.

Canton's DTCC MVP (H1 2026)

Validating the feasibility of blockchain in U.S. Treasury settlements;
If successful: could shift trillions of dollars in capital flows to on-chain infrastructure.

Passage of the U.S. CLARITY Act

Providing a clear regulatory framework;
Enabling currently hesitant institutional investors to deploy capital.

Centrifuge's Grove Deployment

$1 billion allocation to be completed within 2026;
Testing the actual capital operation of institutional credit tokenization;
If executed smoothly without credit events, it will enhance asset management firms' confidence.

Market Predictions

2030 Target: Tokenized asset scale reaching $2-4 trillion;
Growth Demand: Increasing from the current $19.7 billion by 50-100 times;
Assumptions: Regulatory stability, cross-chain interoperability readiness, no major institutional failure events.

Growth Forecast by Industry:

Private Credit: Growing from the current $2-6 billion to $150-200 billion (small base, highest growth rate);
Tokenized Treasuries: Potential to reach $5 trillion+ if money market funds migrate on-chain;
Real Estate: Expected to reach $3-4 trillion (depending on whether real estate registration systems adopt blockchain-compatible property registries).

Trillion-Dollar Milestone:

Expected Achievement Timeframe: 2027-2028;
Expected Distribution:
Institutional Credit: $30-40 billion;
Treasuries: $30-40 billion;
Tokenized Stocks: $20-30 billion;
Real Estate/Commodities: $10-20 billion.

This requires a 5-fold growth from current levels. Although the target is ambitious, considering the institutional momentum in Q4 2025 and the upcoming regulatory clarity, this goal is not out of reach.

Why These Five Protocols Are Crucial?

The early 2026 landscape for institutional real-world assets (RWA) shows an unexpected trend: there is no single winner because there is no single market.

To be frank, this is the direction that infrastructure should develop.

Each Protocol Addresses Different Issues:

Rayls → Banking privacy;
Ondo → Tokenized stock distribution;
Centrifuge → On-chain deployment for asset management firms;
Canton → Migration of Wall Street infrastructure;
Polymesh → Simplifying securities compliance.

The market size growing from $8.5 billion at the beginning of 2024 to $19.7 billion indicates that demand has surpassed speculative behavior.

Core Needs of Institutional Players:

CFOs: Yield and operational efficiency;
Asset Management Firms: Reducing distribution costs and expanding the investor base;
Banks: Infrastructure that meets compliance requirements.

The Next 18 Months Are Critical

Ondo's Solana Launch → Testing the scalability of the retail market;
Canton's DTCC MVP → Testing institutional-level settlement capabilities;
Centrifuge's Grove Deployment → Testing credit tokenization with actual capital;
Rayls' $1 billion AmFi Target → Testing the adoption of privacy infrastructure.

Execution takes precedence over architecture, and results matter more than blueprints. This is the key right now.

Traditional finance is moving towards a long-term process of on-chain migration. These five protocols provide the necessary infrastructure for institutional capital: privacy layers, compliance frameworks, and settlement infrastructure. Their success will determine the future development path of tokenization—whether as an efficiency improvement of existing structures or as a new system replacing traditional financial intermediaries.

The infrastructure choices made by institutions in 2026 will define the industry landscape for the next decade.

Key Milestones for 2026

Q1: Ondo's Solana launch (98+ stocks launched);
H1: Canton’s DTCC MVP (tokenization of Treasuries based on Wall Street infrastructure);
Ongoing: Centrifuge's Grove $1 billion deployment; Rayls' AmFi ecosystem development.

Trillion-dollar assets are on the horizon.

NFA.

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