The stark reality of global wealth inequality has never been more apparent. At the turn of this year, Oxfam published a report that made for uncomfortable reading. What it revealed was stunning: since 2020 the world’s five richest men have doubled their fortunes, while poverty has worsened for nearly five billion people.

This widening gulf is a reflection of a flawed economic structure that continues to concentrate wealth into the hands of a select few.

The Haves and Have Nots

Evidently there are many factors at play here. One of the most egregious concerns is access to opportunity. That is to say, the system perpetuates wealth imbalance by limiting economic opportunities for some while enabling others to secure their financial future.

It is not just those at the bottom of the economic ladder who are cut adrift from economic opportunity. Increasingly, middle-class individuals lack the purchase power to invest in the sort of lucrative assets most likely to deliver a return. Investments that were once within reach – prime real estate in major global cities, for example – are increasingly unavailable to all but the richest strata of society. As a consequence, the big money keeps circulating among the world’s wealthiest individuals, creating a monopolized ecosystem where the rich get richer, the middle-class stand still, and the poorest contend with a cost of living crisis.

What if there was a way to democratize access to high-value assets, bringing them within the scope of ordinary investors? Enter Real World Assets (RWAs), a potentially game-changing innovation enabled by tokenization. Might RWAs disrupt this entrenched system and loosen the stranglehold of the mega rich?

Real World Assets for Regular People

The concept is simple yet revolutionary. Blockchain technology is effectively leveraged to convert traditional assets into digital tokens which can be sold, held, and traded.

By fractionalizing tangible assets – breaking them into smaller, more accessible units – RWAs bring previously elusive investments within the grasp of regular people. Imagine being able to own a piece of a luxury apartment in New York, a fraction of a rare diamond, or a share in a masterpiece hanging in a world-famous art gallery – all without needing millions in the bank.

Indeed, this is one of the appeals of bitcoin. Although there will only ever be 21 million bitcoin in circulation, each is divisible into 100 million Satoshis – meaning just about anyone can own a piece of a cryptocurrency heralded by proponents as ‘digital gold.’ Similarly, tokenization has enabled the fractionalization of actual physical gold bars, assets previously available only to the mega rich.

Fractionalized tokenized assets are increasingly listed on decentralized marketplaces, widening access to the investment opportunities hitherto enjoyed by the world’s elite, from coveted properties and precious metals to government bonds. What’s more, these assets can be traded 24/7 on the open market.

By lowering the barriers to entry for premium investments, RWAs open up fresh avenues for wealth creation to a broader section of society. A middle-class individual in Asia could own a fraction of a commercial property in London’s swanky Knightsbridge, benefiting from its appreciation and rental income. A young shop steward in South America could buy tokenized gold bullion without having to suffer the logistical headache of taking physical ownership of the metal.

Rewriting the Rules of Wealth Creation

The potential of RWAs actually extends beyond individual wealth creation. By widening investor accessibility, physical assets become more liquid – leading to greater price stability. Owners, meanwhile, get to access new opportunities such as crowdfunding and raising capital. Benefits also flow in the direction of institutions tokenizing the real-world assets, chief among them cost savings and increased efficiency.

Whether the availability of RWAs would definitively spark wealth redistribution by chipping away at the elite’s monopoly is a topic of debate. In all likelihood it would take time to achieve a critical mass of investors sufficient in number to have a global impact. Needless to say, education is essential to ensure more people understand and learn to utilize these new investment tools.

Tackling global wealth inequality is imperative, and though a blizzard of possible solutions emerge every year, none have succeeded at scale. In my view, the potential of RWAs to address such inequality is too significant to ignore. By democratizing access to proven profitable assets, we can rewrite the rules of wealth creation and challenge the status quo.

Perhaps the real question we should ask ourselves is: Can we afford not to explore this path towards a fairer financial future? The technology is here. The opportunity is waiting to be taken. It is up to us to seize the day and reimagine wealth distribution for the 21st century and beyond.