Cosmos x RWAs: Why Tokenization Projects Choose Cosmos

The interest shown by institutions, governments, and central banks in on-chain finance has grown substantially over the past several years. More recently, their positive sentiment towards this space has translated into real world assets (RWAs) actually being moved on-chain via tokenization. In fact, the total amount of tokenized RWAs as of February 2025 has reached ~$17.8 billion, marking a 455% increase over the prior 3 years.

As more RWAs move on chain, Cosmos is increasingly becoming noticed by developers as a desirable place to build RWA-focused applications. In this article, we’ll highlight 4 projects within the Cosmos ecosystem that are building key infrastructure for onboarding RWAs: MANTRA, Provenance, Noble, and Ondo, as well as the features that make Cosmos an ideal home for tokenized assets.

Cosmos’ RWA Landscape

MANTRA

MANTRA is a purpose-built Layer 1 blockchain for RWAs, capable of adherence to real-world regulatory requirements. As a permissionless blockchain, MANTRA Chain enables developers and institutions to actively engage in the growing RWA tokenization space by offering advanced technology modules, compliance mechanisms, and cross-chain interoperability.

Some of the chain’s core features include:

• Decentralized Identity Module- Allows users to passport KYC across permissioned RWA dApps
• RWA Token Factory- A module to issue, distribute and manage RWAs onchain
• Compliance SDK- A toolkit for developers to build customizable governance frameworks for onchain permissioned applications

MANTRA recently announced it had successfully obtained a Virtual Asset Service Provider (VASP) license from Dubai’s Virtual Assets Regulatory Authority (VARA), to operate as a Virtual Asset Exchange, as well as provide Broker-Dealer and Management and Investment Services.

MANTRA has several partnerships within Dubai which have led to large-scale tokenization projects as well as efforts to help shape regulation around RWA tokenization. Some of their largest ongoing projects thus far include:

• Tokenizing $500 million of real estate assets with MAG Group
• Tokenizing a $1 billion real estate portfolio with DAMAC Group
• Creating regulatory frameworks for RWA tokenization in the UAE alongside Zand Bank
• Tokenizing aviation assets for increased efficiency with Novus Aviation Capital

Provenance Blockchain

Provenance Blockchain serves as key tokenization infrastructure for legacy financial assets by providing registry and tracking services for new and existing assets. Founded in 2018, the Provenance Blockchain was the first to enable many on-chain RWA activities, such as:

Two organizations that have been instrumental in shaping Provenance’s growth are the Provenance Blockchain Foundation, Provenance Blockchain Labs, and Figure Technologies. The Provenance Blockchain Foundation was founded in 2022 to catalyze the growth, usage and development of Provenance Blockchain, and support the health, security, and governance of the public blockchain.

Provenance Blockchain Labs, also referred to as ProvLabs, builds and operates APIs and SaaS services that make it easier, safer, and less costly for TradFi to adopt and operate on blockchain technology.

ProvLabs has been incremental to onboarding several key use cases to Provenance Blockchain, such as Infineo and Project Guardian with J.P. Morgan and Apollo Global Management. Figure Technologies, which specializes in traditional lending services, has been instrumental in onboarding assets such as mortgage and HELOC originations onto Provenance. Last year, Figure Markets was launched to begin the development of an “everything marketplace” on Provenance, where users would be able to trade a wide variety of RWAs on-chain

Provenance Blockchain has been able to attract a broad userbase and establish itself as a leader in the RWA space. So far, over 70 financial institutions, fintech service providers, and DeFi platforms have used Provenance to generate over $41B in transaction volume and tokenized over $13B worth of assets. Below are some of the key categories that Provenance serves:

Noble

Noble seeks to establish itself as the primary hub for native asset issuance for the Cosmos ecosystem and beyond. So far, the team behind Noble has been primarily focused on stablecoins.

When Noble’s mainnet launched in September 2023, it became the first issuer of native USDC on Cosmos; so far, over $425 million in Cosmos native USDC has been minted. In 2024, Noble expanded to yield-based stablecoins by adding support for issuing Hashnote’s USYC and Ondo’s USDY. These stablecoins derive their yield from highly liquid global assets such as short-term US Treasuries and bank deposits, providing Cosmos users with not only the benefits of stablecoin liquidity, but also a reliable and intrinsic source of yield.

Noble’s next integration will be that of its own stablecoin, USDN, through their partnership with M⁰. Like USYC and USDY, USDN will be fully backed by RWAs (specifically, short-term US Treasury Bills), providing a liquid and reliable source of yield. However, USDN brings a unique feature to stablecoins — composable yield. This enables any platform using USDN to customize its yield distribution, creating opportunities for new forms of incentivization from CEXs, DeFi apps, and more.

Overall, Noble has shown that there’s strong demand for stablecoin liquidity within the Cosmos ecosystem. Within its first year, over $5 billion worth of Noble-issued stablecoin transactions had been executed, and the growth of their product offerings as well as that of the broader ecosystem will only boost this activity in the years to come.

Ondo

The most recent RWA project to announce a Cosmos appchain launch, Ondo has been highly successful in bringing traditional financial institutions to web3. Through their long list of partnerships, which includes major global institutions such as BlackRock, Wellington Management, Franklin Templeton, and WisdomTree, Ondo has made major strides in tokenizing RWAs. Their product list currently includes:

• RWA-backed stablecoins — USDY and OUSG represent ~$1 billion worth of tokenized US Treasuries and bank deposits
• Ondo Global Markets — offers thousands of tradable “GM tokens” representing 1:1 units of stocks, bonds, and ETFs from public US markets
• On-chain lending/borrowing — Ondo’s Flux platform enables users to borrow against tokenized RWAs like OUSG
• Asset tokenization platform — Ondo’s institutional partners can use the Nexus platform to issue, mint and redeem tokenized RWAs for their clients

While Ondo has historically been based on Ethereum, they recently unveiled their latest major development: Ondo Chain. Built with the Cosmos SDK, Ondo Chain unlocks new possibilities for furthering the mission to bring the world’s assets on-chain.

Why Cosmos?

So, why have major projects like MANTRA, Provenance, Noble, and Ondo chosen Cosmos as their home?

Two core benefits of Cosmos’s Interchain Stack technology platform that strengthen RWA-based projects include:

• The Cosmos SDK’s flexibility and customization
• IBC’s battle-tested security, reliability, and ability to unlock liquidity

Let’s dive into the specific features of each, as well as how they directly help these RWA projects.

Cosmos SDK

The Cosmos SDK is one of the most flexible pieces of blockchain infrastructure. On a high level, it enables builders to create their own Layer 1 blockchain (i.e., appchain). These appchains can be customized via dozens of individual “modules,” or features that can be adjusted to optimize performance for a wide variety of use cases.

For example, the Cosmos SDK enables programmable permissions, which allows developers to create any mix of permissioned and permissionless features within their ecosystem. This is especially useful when onboarding institutional customers due to the varying nature of local regulations, as well as the robust levels of privacy required for sensitive data. On a more granular level, the Cosmos SDK’s flexibility even allows developers to customize transaction types and flows, making for custom transaction logic — which could enable an entity to set custom TXs that better comply with regulatory requirements.

These features are especially beneficial to chains like MANTRA, Provenance, and Ondo, as each project works directly with institutions that must adhere to strict compliance measures based on their locations.

Additionally, because each appchain in the Cosmos ecosystem is self-contained, it can use a predetermined set of validators via the Proof of Authority (PoA) module, an alternative to proof-of-stake. This is another feature that may appeal to RWA-based projects, as it allows validator operators to be whitelist-based. For example, a bank that wants to tokenize high-yield savings accounts may need to know the identity of the network’s validator operators to comply with local regulations .

Provenance also serves as an example of how custom modules can optimize appchains for RWA-centric activities. Specifically, asset tracking is critical for a project like Provenance, which deals largely in mortgage originations and other lending services. Their custom Metadata module fulfills this need by recording ownership details of non-fungible assets such as loans, which can then be tracked using the standard SDK modules for token transfers and NFT tracking.

The Inter-Blockchain Communication Protocol

Since its launch in March 2021, the Cosmos SDK’s Inter-Blockchain Communication protocol (IBC) has become one of the most prominent bridges in web3, linking ~115 appchains and transporting billions of USD worth of assets each year.

Projects like Noble use IBC to bring much-needed stablecoin liquidity to Cosmos. As their name suggests, stablecoins provide stability to an ecosystem, serving as core base assets for trading pairs, popular choices for lending/borrowing, and a means to hold familiar fiat-denominated assets in a portfolio without offboarding assets from the web3 space. Not only are these projects bringing stablecoins to Cosmos, they’re doing it in a way that showcases one of the many use cases that RWAs can bring to web3: tokenized Treasuries. So, in addition to providing stability, they generate an inherent yield from Treasuries which is directly passed onto their holders.

Additionally, projects can tap into the customizability of the Cosmos SDK to create their own IBC-based infrastructure. For example, Noble’s custom IBC forwarding module enables the Noble appchain to serve as a router for liquidity moving between Cosmos appchains. This further reduces friction when transferring stablecoins like Noble’s USDN between any IBC-connected chains.

Conclusion

Overall, Cosmos offers an unparalleled combination of customization, interoperability, and performance. The customization of Cosmos SDK enables projects to maximize resources to fit just about any use case for their own L1 blockchain, and IBC prevents the fragmentation of liquidity and users by enabling seamless communication such as asset transfers between individual appchains.

Compared to monolithic L1s with limited flexibility, shared bandwidth and validator sets, and limited interoperability with external networks, Cosmos serves as an ideal home for projects in the RWA space which must adhere to strict geography and industry-specific laws and regulations. MANTRA, Provenance, Noble, and Ondo serve as great examples of how Cosmos is attracting top RWA platforms, and we’re excited to see what the future holds.

Get in touch

If you’re ready to start building on Cosmos or have any questions, don’t hesitate to reach out to the Interchain Labs team here!