RWA Boom Masks Potential Financial Crisis Risks, Warns MEXC

The current surge in tokenized real-world assets (RWAs), which are projected to reach over $23 billion in 2025 from just $1 billion four years prior, raises significant safety concerns according to MEXC COO Tracy Jin. She emphasizes that although the growth appears promising, it bears a resemblance to past DeFi lending experiments where tokens based on unpaid invoices seemed secure on-chain but were backed by risky or defaulting businesses, ultimately leading to collapse when defaults increased. Jin warns that the significant risks associated with RWAs are not merely tied to the assets themselves but to factors like opaque issuers, overinflated valuations, and inadequate custody solutions. These vulnerabilities could transform seemingly safe tokens into systemic hazards, especially considering the potential for unregulated actors to exploit the market and propagate risky debt tokens without proper oversight, audit, or legal clarity—risks reminiscent of the 2008 financial crisis embedded within the crypto domain.