Why do we need real world assets on blockchain anyway?

By Philipp Pieper and Timo Lehes, co-founders of Swarm

Blockchain is an amazing technology with the potential to transform the way that assets are traded. So far, it has been used largely by deregulated actors, often via centralised exchanges. The pre-eminent use case for tokenisation at the moment is trading real world assets, but its reputation has been dragged through the mud. FTX and Celsius highlighted the perils of unregulated trading, the opacity of centralised actors and that crypto assets are too highly correlated and easy to manipulate. This rings true with comments from Goldman Sachs’s digital assets chief, Mathew McDermott, who says markets are looking for a “flight to quality.”

The current crypto bear market and lack of diversified assets available on chain have resulted in fewer yield-bearing opportunities and products on chain. Rising interest rates have highlighted the attraction of interest-bearing assets from traditional markets, which are not yet available in the decentralised finance (DeFi) ecosystem. The promise of con…