The long-term promise of real-world asset (RWA) tokenization lies in native issuance: assets that are born digital, enforce compliance through code, and move seamlessly across decentralized rails. But just as early financial markets didn’t leap straight from paper to fully electronic systems, today’s tokenization landscape is following an incremental path. Legacy structures and legal frameworks still play an important role in helping institutions engage with blockchain infrastructure at scale—while we build toward a more integrated future.
The shift from physical to digital assets has never been a single leap, but rather a more gradual and iterative process. In the 1970s, as capital markets grew more complex, institutions like Euroclear and DTCC didn’t immediately dematerialize securities. Instead, they immobilized them, storing physical certificates in vaults while recording ownership changes electronically. This hybrid model wasn’t elegant, but it made digitization feasible and proved an important stepping stone toward scale.
Today, we’re seeing a similar transitional architecture emerge in blockchain-based finance. Special Purpose Vehicles (SPVs) are playing the role of digital stand-ins, holding tokenized real-world assets (RWAs) such as U.S. Treasuries and other financial services, real estate, or credit instruments, while issuing tokenized representations onchain.
This SPV-based tokenization model is rapidly gaining adoption. From money market funds on public chains, to tokenized treasuries across private chains, SPVs provide legal clarity and operational familiarity. Critics call them clunky, centralized, and legally redundant. And they’re not wrong. But they may also be missing the bigger picture.
Why SPVs Exist and Why They Matter
SPVs serve as transitional infrastructure: compliance-compatible bridges that allow offchain capital to interface with blockchain systems under current legal and regulatory norms. For institutional participants, they provide a familiar legal wrapper, a pathway to regulatory approval, and an operational model rooted in precedent.
This was precisely the role DTCC and Euroclear played in traditional markets. Immobilization wasn’t ideal, but it was essential. It allowed systems, standards, and stakeholders to evolve in parallel. SPVs today are doing the same: testing infrastructure, onboarding institutions, and mapping legal constructs onto programmable rails.
But we shouldn’t confuse a bridge with a blueprint. SPVs are not the future of tokenization. They are scaffolding.
Native Issuance: The Real Opportunity
The true transformation lies in natively-issued onchain assets, securities, credit instruments, and real estate that are born digital, enforce compliance through code, and settle atomically without legal wrappers. This isn’t just a technical upgrade. It redefines financial logic.
With native issuance:
The token is the legal instrument
Compliance is embedded at the protocol level
Liquidity is composable, not fragmented
Custody, settlement, and compliance become programmable
This is where the XRP Ledger (XRPL) is optimized to lead. As a public blockchain designed for finance, XRPL offers native support for direct issuance, composability, and institutional-grade programmability, key features needed to realize the full potential of RWA tokenization. Ripple contributes to this infrastructure by advancing core protocol development, collaborating with institutional partners, and supporting ecosystem projects building on XRPL.
Projects like Ctrl Alt’s collaboration with the Dubai Land Department (DLD) already demonstrate this future. Their pilot sees property ownership records being minted onchain, in this case on the XRPL. The result: streamlined transfer, improved auditability, and regulatory oversight, all natively embedded.
And the XRPL is uniquely suited for it. With financial primitives like a built-in DEX, fast and low-cost settlement, and standards like XLS-30 (AMM) and XLS-65 (Lending Vaults), XRPL offers the protocol-level tools needed to issue, trade, and manage tokenized assets at scale.
In addition, Ctrl Alt will also integrate Ripple Custody into its tech stack to enable scalable, secure digital asset storage for Dubai’s tokenized real estate title deeds. This is just one example among many of how we are pushing at the forefront to power this next evolution of digital finance.
The Right Evolution, Not a Radical Rejection
It’s tempting to dismiss SPV models as a distraction. But doing so risks ignoring the path through which most institutions must travel. Legal innovation takes time. Infrastructure must be tested. Regulators need transparency. SPVs provide all three, while we build toward a system that no longer needs them.
Just as immobilization preceded dematerialization, SPVs are a stepping stone to a future of seamless, natively-issued digital assets. Let’s not mistake pragmatism for stagnation. The onchain economy is evolving, and we’re helping shape it at every level.
