Mentors:

Jack Melnick

DeFi Lead, Polygon Labs
DeFi

BI 006 Real World Assets, Onchain

Problem Statement

  • The idea is to tokenize and bring real-world assets such as stocks, bonds, or other traditional financial instruments onto The blockchain. by leveraging Account Abstraction, The goal is to provide a simplified user experience (UX) that enables mass adoption.
  • The current process of trading and investing in real-world assets involves various intermediaries, complex procedures, and geographic restrictions. this creates barriers for individuals who want to participate in The global financial markets.
  • By bringing RWAs on-Chain, The aim is to eliminate These barriers, increase accessibility, and provide a simplified user experience for trading and investing in traditional financial instruments. this opens up new opportunities for global participation, democratizes access to financial assets, and enhances The efficiency of transactions.

Potential solution

  • Asset Tokenization: real-world assets such as stocks, bonds, or other financial instruments are tokenized and represented on The blockchain. this process involves converting The ownership rights and characteristics of The assets into digital tokens that can be securely stored and transferred.
  • Account Abstraction: Account Abstraction is utilized to simplify The user experience and eliminate gas fees and The need for seed phrases. this ensures a frictionless and intuitive trading experience for users, making it easier for them to participate in The market without technical complexities.
  • Trading platform: a user-friendly trading platform is developed to facilitate The buying and selling of tokenized RWAs. The platform provides intuitive interfaces, order books, market data, and tools for users to trade and manage their investments.
  • Regulatory Compliance: Compliance with Regulatory frameworks and securities laws is crucial when dealing with tokenized RWAs. The solution should incorporate necessary Compliance measures, such as Know your Customer (KYC) and Anti-Money Laundering (AML) procedures, to ensure legal and Regulatory requirements are met.

Challenges you may have to overcome

  • Incorporating real-world assets into a crypto ecosystem involves navigating complex Regulatory frameworks. ensuring Compliance with financial regulations, securities laws, and Know your Customer (KYC) requirements can be challenging and requires collaboration with legal experts.
  • Tokenizing real-world assets requires Establishing legal structures, such as special purpose vehicles (SPVs) or Asset-backed tokens, to represent ownership.
  • Determining The value of real-world assets accurately and Establishing a liquid market for trading those assets within The crypto ecosystem can be challenging.

Business model

  • Transaction Fees: Charging transaction fees for trades executed on the platform.- Subscription Model: Offering premium features, advanced trading tools, or enhanced market data through a subscription plan.
  • Market Making: Engaging in market-making activities to provide liquidity and earn spreads on trades.
  • Custodial Services: Providing secure custody services for users' tokenized RWAs, charging fees for custody and management.

Market Opportunity

The Total Addressable Market (TAM) for a Real World Asset (RWA) protocol can be significant, as it encompasses the value of all real-world assets that can potentially be tokenized and brought onto the blockchain. Estimating the exact TAM is challenging, as it depends on various factors such as the types of assets targeted, the geographical scope, and market adoption.

  • The GTM strategy could involve partnering with established financial institutions, brokerage firms, or asset management companies to leverage their expertise, regulatory compliance capabilities, and customer base.
Apply Now

FAQs

For anyone not familiar, What is Polygon zkEVM?
What are the main features of Polygon zkEVM?
What is so unique about zkEVMs?
Why is EVM Equivalence needed?
What is the difference betweeen EVM compatbility and EVM equivalence?
What EVM opcodes are different on Polygon zkEVM?
Which opcodes are missing in the current zkEVM version?
What precompiled smart contract functions does Polygon zkEVM support?
Can this layer 2 zkEVM work with other chains?
All information provided through the Polygon Village is for informational purposes only and should not be construed as professional advice. Use of any information you obtain via the Polygon Village is done at your own risk. Polygon Labs does not guarantee the accuracy, originality, or legality of any information provided through the Polygon Village.