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In most industries, both legacy and crypto, a $3B contract would be widely regarded as a big deal. Financially and symbolically, it’s the sort of figure that generates headlines. A rounding error in the context of, say, US national debt, but in most other spheres, a huge sum. It’s no surprise then that Mavryk’s $3B real estate tokenization deal has captured attention.
The agreement signed between Mavryk Dynamics and Multibank and MAG, the two companies that own the underlying real estate assets, is significant for a number of reasons. The most obvious one is of course the value of the deal, which once tokenized and tradable, will swell the market cap of the RWA sector. And it’s naturally an even bigger deal for Mavryk, which now has a treasure trove of real-world assets with which to kickstart its RWA blockchain.
The deal has captured attention from all quarters, particularly within the RWA industry itself of course, where competition to attract TradFi investors and their portfolios is fierce – and in this respect Mavryk appears to have pipped Mantra to the punch.
Mavryk Woos Major Real Estate Funds
At present, the majority of all real-world assets being traded onchain are for T-bills, gold, stocks, and other forms of US government debt. It’s important stuff, even if it’s not the sort of stuff that’s going to appeal to a vast swathe of existing DeFi users, who like their yield a little juicier and their assets more exotic. The Mavryk deal, however, ticks a lot of the right boxes when it comes to onboarding DeFi users to the world of RWAs – a world that the majority have yet to explore.
For one thing, the assets themselves are quite prestigious, including the Ritz-Carlton Residences in Dubai and Creekside as well as Keturah Reserve, which funds luxury apartments in Dubai. For another, as yield-generating assets they’ll enable holders to receive a share of the wealth generated by this portfolio, which contributes to the $360M in profits Multibank and MAG accrued last year.
There’s another interesting thing about the $3B Mavryk deal, however, which has been less widely reported. Approximately $500M of those assets were originally destined for Mantra, another Layer 1 chain for trading RWAs. While the reasons behind Multibank and MAG’s change of heart are unclear – assuming it was their decision to exit that deal – the firms have found a partner in Mavryk only too willing to take all the real-world assets they can procure.
RWA Sector Dons Its Game Face
When the $3B of assets is issued on Mavryk’s new Layer 1 chain, they’ll be tradable through Multibank’s own platform for tokenized real estate. The technical implementation, however, will be handled by Mavryk Dynamics. Significantly, Mavryk Dynamics appears to be interested in using these assets as the bedrock of a broader onchain financial ecosystem it’s building, and thus there’s scope for holders being able to use them as collateral in future for borrowing as well as other DeFi purposes.
The deal that Mavryk has secured with the two real estate investment titans may appear to have come out of nowhere, but has in fact been some time in the making. Its closure was bolstered by the closure of Mavryk Dynamics’ own seed round in February, as reported by CoinDesk. The $5.2M it secured will be put towards building out its Layer 1 chain together with all the attendant tech required for RWA tokenization and compliant trading.
That tech will soon be put to good use in tokenizing the $3B of real-world assets Mavryk now boasts with which to kickstart its chain. If it can onboard sufficient users to its nascent network – and a forthcoming token generation event should help there – it will have all the pieces in place to lay claim to being a serious RWA player. In the process, it will have done its bit to bump the sector’s TVL, which has now surpassed $22B and is rising fast.
If the industry keeps growing at its current rate, it’s on course to surpass liquid staking as the largest onchain sector by TVL. And with trillions of dollars still waiting to be tokenized, it’s a market that appears destined to move in one direction only. Freed from the volatility inherent to crypto assets, RWAs are immune to virtually everything save for a major global recession. And if that happens, everything short of stablecoins will temporarily lose ground. Over a longer time horizon, however, the RWA sector remains on course to reach the $18.9T that has been projected for 2033.
