GMultipli Gang!🫡
The world is moving on-chain, and that is amazing news. Major companies and banks around the world have tokenised their assets, and many more are working towards it. And with new assets flowing into the market every week, RWAs (real world assets) have become a major part of our industry.
More companies on-chain → More capital in crypto → More innovation → More growth
While this is mostly good news, the way in which companies are approaching tokenisation creates a problem, and it isn’t even their fault.
For a token to achieve maximum potential, it should be viable across DeFi markets. And for a protocol to onboard a new token or RWA, it can take from a couple of weeks to a few months, depending on the nature of the token and its tokenomics.
On one side, we have new tokens entering the market every month. On the other side, it takes time (a lot!) to onboard them. Hence, many tokens are unusable in DeFi for a long time.
Who does this affect the most?
Users. They are left holding RWA tokens that are not usable in many DeFi platforms. This is where rwaUSD comes in!
In this blog, we will learn about what rwaUSD and rwaUSDi are and how they help solve the above problem.
What is rwaUSD?
rwaUSD is a credit-backed stablecoin designed to represent value backed by highly liquid tokenised real-world assets (RWAs) and make them viable across DeFi.
Key characteristics of rwaUSD:
Brings fragmented tokenised assets into a single collateral interface.
Maximises composability, allowing RWAs to function seamlessly across DeFi protocols.
Unlocks yield avenues, so tokenised assets can be productive without waiting to be integrated with every protocol individually.
Designed with peg protection in mind. It is built with an insurance framework underwritten by Lloyd’s of London.
Who can use rwaUSD?
rwaUSD is designed for highly liquid, institutional-grade assets such as:
Short-duration Treasury-backed instruments (T-Bills): BUIDL, USDY, BENJI, etc.
Highly liquid tokenised gold: PAXG, XAUTz, etc.
Other deep, continuously priced public-market RWAs: Public bond ETFs, Commodity funds, etc.
What is an institutional-grade asset?
Institutional-grade assets are assets that meet the standard set by banks, asset managers, etc. to invest and deploy large amounts of capital safely and consistently.
However, rwaUSD is not applicable for all tokenised assets. Assets like private equity, structured funds, or vehicles with delayed redemption windows have a fundamentally different nature.
The Nature of Private Credit
Private Credit is fundamentally illiquid and structured:
Cash flows are scheduled and not instantaneous
Redemptions are not instantaneous
Pricing is not continuous
Liquidation often lends negative results
While you can tokenise these assets, adding them to DeFi pools or AMMs will create systemic risk and poor capital efficiency. It is inherently incompatible with DeFi platforms.
This is where rwaUSDi comes in.
What is rwaUSDi?
rwaUSDi is designed as an institutional, permissioned credit layer optimised for the assets mentioned above.
Key characteristics of rwaUSDi:
Enables illiquid and structured assets to exist on-chain without tampering with DeFi markets.
Prioritises capital efficiency over composability due to the nature of private credit assets.
Isolates risk and ensures predictable borrowing conditions.
Optimised for institutional controls.
Who can use rwaUSDi?
rwaUSDi can be used by:
Private credit facilities
Asset-backed loans
Project finance (mines, energy assets, infrastructure)
Refinancing of existing debt
Structured or market-neutral strategies with defined horizons
rwaUSD vs rwaUSDi: Core Differences
rwaUSD | rwaUSDi | |
|---|---|---|
Definition | rwaUSD is a credit-backed stablecoin designed to represent value backed by highly liquid tokenised real-world assets. | rwaUSDi is an institutional, permissioned credit layer optimised for illiquid and structured RWAs. |
Primary goal | Bring highly liquid, near-cash RWAs into composable DeFi markets. | Bring private credit assets with illiquid structures into DeFi markets. |
Asset type | Highly liquid, institutional-grade assets like short term treasury-backed assets, highly liquid gold, etc. | Private credit, asset-backed loans, etc. |
Role | Maximises composability and liquidity | Maximises capital efficiency |
Liquidity profile | High liquidity, instantaneous redemptions | Low liquidity, delayed or scheduled redemptions |
Pricing | Continuous, market-based pricing | Non-continuous, modelled or scheduled pricing |
Redemptions | Designed for frequent and flexible use | Delayed or maturity-based redemptions |
Cash flows | Implicit or market-driven | Scheduled and predictable |
DeFi compatibility | High — built for AMMs, lending, composability | Low — intentionally isolated from open DeFi pools |
Users | Users holding eligible RWAs | Authorised institutions |
Final Thoughts
We have covered the basics of rwaUSD and rwaUSDi in this blog. For a deeper insight into rwaUSD, dive into our docs where we break down why tokenisation is inevitable, the problems it brings, and how we are striving to build the solution.
For more updates, stay tuned to our socials:
See you soon 🫡
