Standard Chartered: The scale of on-chain tokenized assets is expected to reach $40 trillion by the end of 2028, with DeFi protocols emerging as the primary beneficiaries.

May 18 — Geoffrey Kendrick, global head of digital assets research at Standard Chartered Bank, projected that total on-chain tokenized assets will reach $40 trillion by the end of 2028, with stablecoins and Real World Assets (RWA) each accounting for $20 trillion of that sum. Standard Chartered identifies DeFi protocols with robust risk management frameworks and scalability as the primary beneficiaries of this growth, noting that progress on the U.S. “Clarity Act” could act as a key catalyst to speed up the integration of on-chain solutions in traditional finance (TradFi). Kendrick emphasized DeFi’s core advantage is its composability. In on-chain ecosystems, a single asset can generate yield, serve as collateral, and supply liquidity all at once — a level of efficiency legacy financial systems can’t match. He summed up this structural edge with the phrase: “1+1=3.” Citing BlackRock’s tokenized U.S. Treasury bond fund BUIDL as an example, Standard Chartered explained that the product delivers roughly 4% yield from U.S. Treasuries, while also being convertible to sBUIDL for DeFi use: it acts as collateral in lending protocols and a reserve asset for products like Ethena USDtb and Ondo OUSG. The report also highlighted that today’s off-chain asset base is roughly 1,000 times larger than its on-chain counterpart, signaling that institutional asset tokenization will drive the next major growth wave for the digital assets sector. On institutional adoption, Standard Chartered noted that Aave’s total asset size once matched that of the 38th-largest U.S. bank, while current daily on-chain stablecoin lending volumes sit between $1.5 billion and $2 billion. Separately, the Bitcoin lending product collaboration between Coinbase and Morpho has an outstanding loan balance of roughly $1.75 billion, covering about 22,000 borrowers — proof that traditional financial institutions are increasingly weaving DeFi into their core infrastructure.