RWA Trading Redefines DeFi Platform Economics

Decentralized finance (DeFi) platform economics are undergoing significant changes due to the growth of real-world asset (RWA) trading. Lorenzo Valente, ARK Invest's Director of Research for Digital Assets, believes that specialized RWA venues could reshape onchain liquidity and the competitive landscape.

Historically, winning crypto trades required a large market share in Bitcoin (BTC) or major layer-1 exchanges like Binance and Coinbase. However, Valente argues that new platforms can now focus on RWAs and build significant onchain outcomes without needing to compete directly with established exchanges.

Valente pointed to Trade.xyz as an example of this trend, noting its potential to become the primary source of activity for Hyperliquid, a decentralized exchange. If Trade.xyz grows to 90% of Hyperliquid's volume, Valente expects it to demand a larger share of the overall user fee.