RedStone launches settlement layer to address RWA liquidity gap in DeFi lending
According to ChainCatcher, decentralized oracle service provider RedStone has officially launched RedStone Settle, a settlement layer product for decentralized finance, aiming to address structural barriers faced when tokenized real world assets (RWA) are used as collateral in lending protocols.
The core mechanism of this product is on-chain auctions: when a lending protocol triggers a liquidation event, liquidity providers can immediately step in to purchase relevant positions, providing instant liquidity to the protocol while assuming the redemption delay risk of the underlying assets themselves. This approach aims to bridge the mismatch between the near-instant liquidation required by DeFi platforms (such as Aave) and the typical 60 to 180 day redemption cycle of RWA, including tokenized funds and bonds. RedStone stated that this solution could activate more than $3 billion worth of idle tokenized RWA in DeFi, enabling users to lend and borrow more efficiently with yield-generating positions. According to data from RWA.xyz, excluding stablecoins, the current tokenized RWA market exceeds $3 billion, mainly dominated by exposure to U.S. Treasury bonds and private credit products.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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