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What is RWA tokenization? A plain-English guide
RWA tokenization means representing ownership of a real-world asset — like gold, US treasuries, private credit or real estate — as a blockchain token, so it can be held, transferred and settled on-chain while the underlying asset sits with a custodian.
How it works
An issuer holds the real asset (or a fund/SPV that owns it) with a custodian, then issues tokens that represent claims on it. The token trades and settles on-chain; redemption and custody happen off-chain. The whole model rests on one question: can you verify the tokens are actually backed?
The main asset classes
Precious metals (e.g. tokenized gold), tokenized US treasuries and money-market funds, private credit, real estate, and tokenized equities. They differ sharply in transparency: treasuries and metals tend to be the most verifiable, private credit and real estate the hardest.
What to verify before trusting any RWA token
Reserve proof, custody and segregation, independent audit, on-chain contract integrity, redemption rights, and the issuer's legal structure. Claridex scores every token on exactly these six pillars so you can compare verifiability across asset classes.
FAQ
Is RWA tokenization safe?
It varies enormously by token. The technology doesn't make the asset safe — verifiable backing, custody and legal structure do. Always check transparency before size or yield.
What's the biggest risk in RWA tokens?
Unverifiable or misrepresented backing: if you can't independently confirm the reserves, custody and redemption, the on-chain token may not be worth its claim.