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Stablecoins Lead Tokenized Deposits in Security and Integration Capabilities

Stablecoins Lead Tokenized Deposits in Security and Integration Capabilities

Bitget-RWA2025/11/01 23:50
By:Bitget-RWA

- Experts argue stablecoins outperform tokenized deposits in safety, liquidity, and cross-chain interoperability, per Columbia Business School and Markets.com analyses. - Tokenized real-world assets (RWA) market could hit $2 trillion by 2028, driven by stablecoin liquidity and DeFi integration, Standard Chartered forecasts. - Banks resist yield-bearing stablecoins fearing market share loss, while U.S. regulatory clarity remains critical for sector growth, reports note. - Institutional adoption accelerates

The competition between stablecoins and tokenized bank deposits is heating up, with many analysts asserting that stablecoins have a clear advantage in terms of security, usability, and widespread use. Omid Malekan, who teaches at Columbia Business School, argues that stablecoins backed one-to-one by cash or short-term assets are fundamentally more secure than tokenized deposits issued by banks using fractional reserves. “Stablecoins are naturally better equipped to handle liquidity challenges,” Malekan explained, highlighting that tokenized deposits are often limited by KYC requirements and lack broad compatibility, as noted in a

.

Stablecoins Lead Tokenized Deposits in Security and Integration Capabilities image 0

Stablecoins also excel in composability, allowing them to be easily integrated throughout the crypto landscape and within decentralized applications (dApps). In contrast to tokenized deposits, which are typically restricted to closed systems, stablecoins support international payments, yield-generating protocols, and interactions with DeFi platforms, according to a

. This flexibility is fueling their rapid rise, as both businesses and individuals increasingly look for alternatives to conventional banking.

At the same time, the market for tokenized real-world assets (RWA) is expected to reach $2 trillion by 2028, based on a

. Geoffrey Kendrick, who leads digital asset research at the bank, credits this anticipated growth to the liquidity provided by stablecoins and the expanding influence of DeFi in connecting traditional finance with blockchain. The report predicts $750 billion each in tokenized money-market funds and U.S. stocks, along with $250 billion apiece in commodities, private equity, and real estate. This would mark a 57-fold jump from today’s $35 billion RWA market.

Stablecoins are at the heart of this evolution. With a total market value surpassing $300 billion, they serve as the main source of liquidity for tokenized assets, streamlining on-chain transactions and yield opportunities, according to Standard Chartered. Tether’s

and Circle’s , for example, are leaders in the field, while newer entrants like and continue to expand liquidity options. “Stablecoins are the entry point for broader RWA integration,” Kendrick commented in a .

Yet, there are still hurdles to overcome. Banks and other financial players are pushing back against stablecoins that pay interest, concerned about losing their share of the market. The banking sector has actively opposed yield-generating stablecoins, which could threaten traditional interest-based business models, as highlighted in the Markets.com article. Regulatory ambiguity is another significant barrier. Standard Chartered cautions that without comprehensive U.S. crypto regulations before the 2026 midterms, progress could be delayed, the report adds.

Even so, institutional interest is growing rapidly. Coinbase’s recent $2 billion offer for stablecoin infrastructure provider BVNK highlights the strategic importance of the sector, while BlackRock and other major players are exploring funds backed by stablecoins, according to a

. , the largest stablecoin provider, expects to earn $15 billion in annual profits by leveraging its U.S. Treasury reserves, the Coinotag article reports.

As the financial industry adapts to these changes, the decision between stablecoins and tokenized deposits will depend on practical use and regulatory developments. At present, stablecoins seem to be leading, thanks to their flexibility, liquidity, and growing institutional support.

0

Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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