The coming convergence: bridging public and private networks
The OGs of public and private programmable blockchains – Ethereum and Corda – celebrate tenth anniversaries this year. And something exciting is happening: the two worlds they unleashed are beginning to converge. Ten years into this journey, 2025 is the year when TradFi and DeFi finally figure out how to work together.
In this piece, I examine why private blockchains were created in the first place, how their deployment means there are now billions of dollars of Real-World Assets primed for tokenisation onto public networks, and how the final step to make this happen might be a surprisingly simple upgrade to the dozens of private networks already in operation.
tl;dr: there is an opportunity hiding in plain sight to bring $10bn+ of RWAs to public crypto networks, and to unlock true atomic transactions between regulated assets on the permissioned networks, and high quality stablecoins on public networks.
Think back to 2015. Ethereum had just launched, and R3 was formed, supported by 40+ banks, to figure out how blockchains might be adopted by the traditional financial system.
Even then, something was very obvious: the new blockchains worked very differently to traditional financial systems and so demanded close investigation. They were always-on; they were open; transactions settled in near-real-time. Emerging platforms like Ethereum heralded the possibility of a global, shared computer for the modelling and processing of any financial transaction, irrespective of country, asset class or type of investor. In short, what came to be known as Decentralised Finance – DeFi – looked very different to Traditional Finance – TradFi, and its attractions were evident: simpler, standards-based, composable, global.
DeFi wasn’t enough for financial markets
In many ways, DeFi is perhaps how the financial system would have been designed had modern finance emerged in the internet era, rather than the telegraph era. Alas, we must confront the world as we find it, not as we might want it to be.
So banks were faced with a dilemma: they couldn’t directly use permissionless networks back then, but nor could they risk ignoring this new technology. Many approached it as a long-term research question: they experimented with public networks to gain experience but otherwise operated their businesses as usual, waiting for some of the problems with public blockchains of the time – such as the lack of privacy or transaction finality – to be fixed, and for regulators to give them the green light to move.
R3 took a different path. We worked directly with the financial community to build a platform that more pragmatically reflected the reality in which they found themselves, so they could get started with real projects immediately. This platform – Corda – enabled its users to make material progress on their DeFi journey without having to change every part of the business model on day one or wait for regulations to change.
The largest collection of RWA networks globally
This strategy has been a quiet success: Corda now has the most live networks of any platform – public or private, collectively processing millions of transactions, managing over $10bn of on-chain assets daily. These platforms provide access to tokenized assets to both retail and institutional investors, widening market access and driving efficiencies across the ecosystem. As the single largest collection of RWA networks in the world, Corda would be #1 on app.rwa.xyz, below, if it were not for Corda’s strict privacy features making it invisible to block explorers!
So the chart below perhaps better represents the opportunity:
But dozens of private networks is only a starting point, and can only take us so far. We and our customers are proud of our achievements, but also humble about how far there still is to go: these networks still have to be fully connected to each other, and to the broader public ecosystem.
The recent change in US administration and establishment of numerous working groups within the US government and regulatory bodies means the regulatory blockers to connecting these private networks to the huge public ecosystem are now dissolving, which means it will soon be only technology that stands in the way.
Importantly, this shift is coming at a time when the crypto ecosystem itself has matured. The community has developed a range of solutions that enhance the security, scalability, and efficiency of their networks, including rollups and zero-knowledge proofs. Long past the days of Terra Luna, there is now a proliferation of well-regulated, high quality stablecoins, and we’re seeing the emergence of regulated yield-bearing stablecoins. The SEC’s recent approval of this DeFi native innovation signals not only a thawing in regulators’ icy attitudes towards crypto but also the regulated market’s growing demand for DeFi native innovations.This is why I specifically referenced rwa.xyz above. It seems increasingly likely that the next big driver of growth [1] in public networks will indeed be RWAs – digital, tokenized representations of securities, property and other valuable assets that exist in the “real” world of TradFi. Standard Chartered forecasts that the RWA market will grow to $30tn by 2034, for example, so it’s perhaps no surprise that banks are clamouring to enter this space.
Bridging DeFi and TradFi to create new market opportunities
However, despite the hype, the amount of RWAs actually issued to public networks today is still quite small, as the rwa.xyz chart shows. This is partly because it’s still early, but it’s also for the reason described at the start of this piece: TradFi and DeFi are fundamentally different, and so directly issuing traditional Real-World Assets onto a public chain will always be complex and slow.
Corda’s quiet success shows that the better way is to keep the complexity of TradFi well away from DeFi. This is the lesson of the hard work that the innovators in the Corda ecosystem such as Corda, SDX, HQLAx, and Euroclear’s D-FMI have quietly been doing over the years. They’ve solved the problem of integration with existing systems, building a brand and customer base, and achieving regulatory compliance.
They knew that the time would come when they could connect their pipeline of investible assets to public networks… but they didn’t wait for this to happen. Instead, they started building years ago… solving the complex TradFi problems first, deploying this complex tokenization logic and TradFi automation onto Corda, which was purpose-build for that problem.
But these networks are nevertheless still standalone: they are not yet connected to the public networks where the true demand sits.
Two worlds converging: connecting TradFi to DeFi to unlock the RWA opportunity
Work has been underway on this problem for some time: a key building block is allowing Corda-based networks to interoperate seamlessly with EVM-based and similar networks. Projects such as Harmonia and demonstrations by HQLAx and Fnality are critical milestones.
But the next logical step requires us to be bolder and even more imaginative. It is time to directly connect the public and private networks. After all, the major public Layer 1s now offer transaction finality, high-quality byzantine-fault-tolerance, and have stood the test of time. There is no longer any reason why they could not provide the transaction sequencing service for permissioned networks who chose to use it, rather than each running their own independent sequencers, as happens today. This would reduce costs for the permissioned networks and more importantly: it would tightly bind them into the public ecosystems to which they were now connected.
Specifically, it would immediately unlock the possibility of true atomic transactions between regulated assets on the permissioned networks and high quality stablecoins on the public network, facilitating higher quality settlement options for regulated networks, and driving demand for ever higher quality settlement assets on public networks.
And, going further, by ‘anchoring’ these private networks to public networks, it would then be possible to seamlessly bridge assets from one to the other.
This step would, in a stroke, lay down the last mile of rail joining the supply of high quality assets on the private networks to the demand on the public networks. It would enable the $10bn in already-tokenized assets to flow freely, meeting the growing demand for RWAs. It would also enable trillions of dollars in Real-World Assets still sitting in legacy systems to enter the pipeline for issuance onto regulated platforms and then distributed onwards into the DeFi ecosystem, progressing financial markets globally and promoting greater access to investors of all kinds.
The public and private ecosystems developed in parallel for good reason. But ten years into our collective adventure, it’s time to bring them together. This convergence is happening faster than you might expect. Whether you’re a TradFi leader looking to take advantage of the new possibilities DeFi now offers or a DeFi investor seeking higher-quality assets, one thing is clear—the future isn’t just promising, it’s already taking shape.
[1] https://www.mckinsey.com/featured-insights/mckinsey-explainers/what-is-tokenization
