It’s a topic that was “widely discussed” at the Blockworks Permissionless II conference, according to investor Santiago Santos. But he questions whether the phrase conveys a real narrative or is simply the latest addition to the industry’s ever-growing collection of meaningless buzzwords.
On the Empire podcast (Spotify/Apple), Santos reflects on his conference experience, observing a “renewed interest in Challenge”, with a particular emphasis on the concept of real-world assets. Despite the attention, not everyone agrees the category will endure, he says.
Blockworks co-founder Jason Yanowitz cites a conference panel who discussed the subject, with DAO Alliance its founding partner, Qiao Wang, says the concept of real-world assets is a “false narrative.”
“His point was,” Santos responds, “stablecoins are real-world assets.”
“How we characterize and describe real-world assets is a catch-all phrase,” Santos says, arguing that industry executives need to be “a little more discerning” when approaching this broad topic.
Santos suggests that many different classifications and potential “garbage buckets” real world assets» might gain traction over time, while others fail.
“Some real-world assets lend themselves more than others to gaining traction on-chain,” he says, adding that many potential assets are “not even worth having a crypto-native ‘wrapper’.”
Yanowitz suggests that the technology’s selling point is its ability to “import yield” in various forms, including stablecoins. He points Maker as an example of a company leading the process by valuing assets off-chain and then importing value into the blockchain.
“In the coming year(s), we will find and develop more ways to import yield in chain.
We always get the nomenclature wrong in crypto
One of the frustrations with the term “real-world assets,” Yanowitz said, was that Robert Leshner, CEO of Superstate at the conference. The phrase “real world” – as a way to differentiate one asset from another – implies that the chain is, logically, not the real world, he explains.
“There are traditional assets and crypto assets,” says Yanowitz. “Or, there are off-chain assets and there are on-chain (assets).”
“We always get the nomenclature wrong when it comes to cryptography,” Santos smiles. “We do some things very well as an industry, but nomenclature is not one of them.”
Santos reflects on the industry’s past failures in real-world assets, noting that the topic tends to be “very polarizing, because it’s already failed.” He cites the example of porta “super hyped” real estate fund tokenization platform that failed to gain traction after receiving a broker license in 2019.
“He didn’t keep his promises,” he said. “It was a good idea. It felt like it wasn’t the right time. It was too early. The infrastructure wasn’t there,” he said. “It’s the state where find crypto today.”
“It’s just important to be aware of things that have been tried in the past (and) to revisit some of them,” he says, “because infrastructure has come a long way.”
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