Centrifuge tops $1B TVL as institutions drive tokenized RWA growth

Blockchain infrastructure platform Centrifuge has crossed $1 billion in total value locked (TVL), joining the ranks of BlackRock’s BUIDL fund and Ondo Finance as the only real-world asset (RWA) platforms to surpass the milestone.

Centrifuge CEO Bhaji Illuminati attributed the milestone to institutions moving from pilots to “real deployments,” alongside strong onchain allocator demand.

“Markets need more than T-bills,” Illuminati told Cointelegraph, pointing to JAAA, an onchain version of Janus Henderson’s AAA-rated collateralized loan obligation (CLO) investment fund, as a natural next step for institutions seeking higher yields than risk-free rates.

Illuminati said that US Treasurys remain the dominant entry point for onchain allocators, but the JAAA product is the fastest-growing tokenized fund in the segment. “We are also seeing rising interest in private credit as institutions look for differentiated yield, with more news coming soon on that front,” he added.

Related: GENIUS Act yield ban may push trillions into tokenized assets — ex-bank exec

Strong demand for tokenized S&P 500

In early July, Centrifuge unveiled a tokenized S&P 500 product as part of a partnership with S&P Dow Jones Indices (S&P DJI). The product is structured as a regulated professional fund in the British Virgin Islands.

According to Illuminati, demand has been “very strong” ahead of its official rollout in the coming weeks. The launch will be supported by an anchor pool of capital to ensure broad accessibility from day one.

Illuminati added that the S&P 500 is only the beginning, with plans to bring sector-specific and thematic indexes onchain in the near future. “We see strong potential for sector and thematic index products to come onchain next,” he said.

Centrifuge’s pipeline is split between traditional asset managers using  Web3 native asset manager Anemoy and onchain-native managers leveraging its RWA Launchpad. On the demand side, stablecoins and yield products are the biggest buyers, using RWAs to set a “yield floor” for reserves.

Related: eToro to tokenize 100 most popular US stocks on Ethereum

deRWA to bring tokenized assets to retail

Illuminati highlighted plans to open tokenized assets to retail investors through major exchanges, wallets, lending protocols and DeFi integrations through the deRWA initiative. deRWA, as used in DeFi, stands for tokenized RWAs that are engineered for composability and liquidity within DeFi.

As reported, S&P Dow Jones Indices (S&P DJI) is also in discussions with major exchanges, custodians and DeFi protocols to license and list tokenized versions of its benchmarks, according to Stephanie Rowton, the firm’s director of US equities.

“By establishing these types of relationships, we hope we can work together to participate in a robust infrastructure that supports the trading and accessibility of tokenized versions of our indexes, ultimately enhancing the investor experience,” Rowton said.

Looking ahead, Illuminati expects public market RWAs such as Treasurys and equities to lead adoption in the short term due to liquidity and familiarity. However, he believes private markets will eventually dominate, as blockchain removes inefficiencies and unlocks hidden value.