Tokenization of government bonds is the most likely area for RWA to be implemented in the short term.

Currently, the tokenized assets of RWA projects related to government bonds have approached 700 million USD, an increase of about 240% since the beginning of the year. The government bond RWA in MakerDAO has also rapidly grown to the level of several billion USD. The overall development momentum of government bond RWA is strong.

Government bonds RWA are similar to LSD, allowing the introduction of risk-free interest rates from traditional financial markets onto the chain, enabling dollar-based investors to adopt traditional allocation strategies. This has several benefits:

1. During a market bear market, dollar-based investors still have relatively safe and stable income channels.

2. It is beneficial to launch mixed equity and debt financial products, promoting innovation in DeFi asset management.

Currently, there are 5 main business models for national debt RWA: agency model, platform model, infrastructure model, self-operated model, and hybrid model.

There are three main types of underlying assets:

1. US Treasury ETF
2. U.S. Treasury Bonds
3. A combination of U.S. Treasury bonds, government agency bonds, cash/reverse repos

The asset business structure mainly includes:

• Trust Structure
• Limited Partnership SPV Structure
• Lending Platform + SPV Structure
• Fund share on-chain

User-end requirements mainly differ in terms of minimum investment amount, KYC, and regional restrictions.

There are mainly two types of profit distribution strategies:

1. Direct allocation of profits through creditor relationships
2. Distributing profits through deposit interest rates

In terms of composability, projects with strict KYC are more limited, while projects without KYC have relatively greater advantages.

The government bond RWA projects that are expected to succeed in the future may have the following characteristics:

• Selection of underlying assets: government bond ETF
• The business architecture is highly scalable.
• No KYC and no barriers on the user side
• The yield is consistent with the government bond yield.
• Strong composability

As regulation deepens, lightweight KYC projects may become more competitive in the medium to long term.