Crypto market structure: how new rules could favour larger players

Explore how regulatory updates in 2025 may concentrate power in the crypto sector, impact retail investors, and illustrate the role of tokenized real‑world assets like Eden RWA.

The article dissects how fresh regulatory frameworks can tilt the playing field toward institutional giants.
Retail crypto users must understand the implications for liquidity, pricing, and access to new asset classes.
Key takeaway: larger market players may gain a structural edge, but tokenized RWA platforms offer alternative entry points.

Crypto market structure: how new rules could favour larger players has become a focal point of industry analysis in 2025. As regulators worldwide tighten oversight—particularly under the EU’s Markets in Crypto‑Assets Regulation (MiCA) and the U.S. Securities and Exchange Commission’s evolving DeFi guidance—the balance between decentralised innovation and institutional dominance is shifting.

For intermediate retail investors, this debate matters because it directly affects market liquidity, price discovery, and the types of products that become available through exchanges and custodial services. It also raises questions about whether tokenisation of real‑world assets (RWAs) can level the playing field or simply become another conduit for institutional capital.

This article will unpack the regulatory changes that are reshaping crypto market structure, explain how they influence player concentration, analyse real‑world use cases—including a detailed look at Eden RWA—and outline practical steps investors should consider when navigating this evolving landscape.

Regulatory shifts reshape crypto market structure

Over the past two years, regulatory bodies have moved from a largely permissive stance to structured oversight. The EU’s MiCA framework now imposes licensing requirements for issuers and platforms that offer tokenised assets, while the SEC has clarified that many DeFi protocols fall under securities law.

These changes create higher compliance costs—particularly for smaller entities—and encourage consolidation. Larger firms can absorb licensing fees, maintain robust AML/KYC pipelines, and build infrastructure to meet custodial standards. In contrast, boutique projects often struggle to match these capital demands.

Key players emerging in this new regime include:

Centralised exchanges (CEXs) that secure regulatory licenses and offer fiat‑onramps.
Institutional custodians such as Fidelity Digital Assets and Coinbase Custody, which now comply with MiCA’s asset‑backing requirements.
Tokenisation platforms that partner with legal entities to create compliant SPVs (special purpose vehicles).

The ripple effect is a market where liquidity pools and token listings are increasingly concentrated in the hands of these well‑capitalised actors, potentially limiting access for individual retail participants.

How It Works: From off‑chain asset to on‑chain token

The tokenisation process converts a physical or financial asset into a digital representation that can be traded on blockchain networks. The general workflow is:

Asset selection and due diligence. A legal entity evaluates the asset’s value, legal status, and regulatory compliance.
Creation of an SPV (Special Purpose Vehicle). This vehicle holds the physical asset and issues a corresponding ERC‑20 token that represents fractional ownership.
Smart contract deployment. The token supply, dividend distribution rules, and governance mechanisms are encoded into Ethereum or another blockchain.
Liquidity provision. Tokens can be listed on exchanges or offered through over‑the‑counter (OTC) desks, often with custodial guarantees to satisfy regulatory thresholds.
Distribution of proceeds. Rental income, dividends, or sale proceeds are paid out in stablecoins like USDC directly into investors’ wallets via automated smart contracts.

Actors involved include the asset owner (e.g., a real estate developer), the SPV manager, custodians, token issuers, and retail investors. Each role must adhere to local securities law, anti‑money laundering statutes, and data protection regulations.

Market impact & use cases

The new regulatory framework has already spurred several high‑profile tokenisation projects:

Real estate tokenisation in the U.S. and EU. Projects such as Harbor and Securitize provide compliant issuance for property assets, attracting institutional capital.
Bonds & structured products. Platforms like Tokeny allow companies to issue regulated debt tokens that comply with MiCA’s asset‑backing rules.
Art & collectibles. Companies are tokenising high‑value artworks and offering fractional ownership, backed by provenance verification and insurance contracts.

Retail investors benefit from lower entry thresholds compared to traditional investment vehicles. However, the concentration of liquidity in large exchanges means that price discovery may be less efficient for niche assets, potentially widening spreads and reducing secondary market depth.

Aspect	Pre‑Regulation (Off‑Chain)	Post‑Regulation (On‑Chain Tokenisation)
Ownership proof	Paper deeds, title records	Immutable blockchain ledger
Transfer speed	Days to weeks	Minutes to hours (depending on network congestion)
Liquidity source	Private sales, brokers	Exchanges, OTC desks, DEXs with regulatory compliance
Compliance cost	Low for small sellers, high for large issuers	Uniform licensing fees; higher for smaller players

Risks, regulation & challenges

Despite the promise of tokenised assets, several risks persist:

Regulatory uncertainty. Jurisdictional overlaps can lead to conflicting obligations. For instance, a project compliant in the EU may still face scrutiny from U.S. regulators if it has American investors.
Smart‑contract vulnerabilities. Bugs or design flaws can expose funds; audits mitigate but do not eliminate risk.
Custody and liquidity. SPVs must hold sufficient collateral to satisfy MiCA’s asset‑backing requirements. Limited secondary markets can trap investors.
KYC/AML compliance. Failure to verify identity can result in fines or frozen assets.
Legal ownership vs token ownership. Token holders often have a financial interest but not direct legal control over the underlying asset, which may complicate governance.

Real‑world examples illustrate these challenges: a tokenised art collection suffered a loss when its insurance policy was deemed non‑compliant with local laws, leading to a halt in dividend payouts.

Outlook & scenarios for 2025+

Bullish scenario: If regulators provide clear, harmonised guidelines and custodial infrastructures expand, tokenised assets could see rapid adoption. Institutional inflows would deepen liquidity, enabling smaller players to thrive via niche offerings.

Bearish scenario: Over‑regulation or enforcement actions against major platforms might stifle innovation. Smaller projects may be forced out of the market, exacerbating concentration and reducing retail access.

Base case: By 2026, most large exchanges will hold MiCA licenses and custodial services will be standard. Retail investors will encounter a mix of compliant tokenised products but will still need to navigate higher fees and limited secondary markets.

Eden RWA: A case study in democratizing luxury real‑world assets

Eden RWA exemplifies how tokenisation can bridge the gap between institutional infrastructure and retail participation. The platform focuses on French Caribbean luxury real estate—properties in Saint‑Barthélemy, Saint‑Martin, Guadeloupe, and Martinique—and offers investors fractional ownership through ERC‑20 tokens.

Key elements of Eden RWA’s model:

SPV structure. Each villa is owned by a dedicated SPV (SCI/SAS) that issues an ERC‑20 token representing indirect shares.
Yield distribution. Rental income, collected in USDC, is automatically distributed to token holders via smart contracts.
Experiential layer. Quarterly draws allow token holders to stay for a free week, adding utility beyond passive income.
DAO‑light governance. Investors vote on major decisions (renovation, sale) while the platform retains operational efficiency.

Eden RWA navigates regulatory requirements by ensuring full transparency, using audited smart contracts, and offering a forthcoming compliant secondary market. For retail investors, it provides an accessible entry point into high‑value real‑world assets without the need for substantial capital or complex legal arrangements.

If you’re interested in exploring how tokenised luxury real estate could complement your portfolio, consider visiting Eden RWA’s presale pages: Eden RWA Presale and Presale Portal. These resources provide detailed information on tokenomics, legal structure, and participation requirements.

Practical takeaways

Monitor regulatory updates in your jurisdiction—MiCA compliance is mandatory for EU issuers.
Check the issuer’s SPV documentation to confirm asset ownership and collateral backing.
Verify that smart contracts have undergone independent audits, especially those handling dividend distribution.
Assess liquidity options: a robust secondary market reduces the risk of being locked into an illiquid token.
Understand the governance model—DAO‑light structures may limit your influence on asset decisions.
Evaluate the fee structure: custodial and platform fees can erode yield over time.
Consider diversification across multiple RWA projects to mitigate concentration risk.

Mini FAQ

What is tokenisation in real‑world assets?

Tokenisation refers to creating digital tokens that represent a share of an off‑chain asset, enabling fractional ownership and easier transfer on blockchain networks.

How does MiCA affect tokenised real estate?

MiCA requires issuers to provide transparent information, maintain adequate collateral, and obtain licensing for certain asset classes, ensuring investor protection and market integrity.

Can I receive rental income in fiat currency from an ERC‑20 token?

No. Most tokenised real‑world assets distribute returns in stablecoins (e.g., USDC) to maintain blockchain compatibility and reduce volatility.

What is the difference between a DAO and a DAO‑light governance model?

A full DAO grants token holders complete control over protocol decisions, while a DAO‑light structure balances community input with efficient management by core teams.

Are there tax implications for holding tokenised assets?

Yes. Tax treatment varies by jurisdiction and may differ from traditional property or securities taxation; consult a qualified advisor.

Conclusion

The evolving regulatory landscape is reshaping the crypto market structure, potentially favoring larger, well‑capitalised players who can absorb licensing costs and meet stringent compliance standards. While this concentration could streamline liquidity and enhance investor protection, it also risks limiting access for smaller participants.

Tokenisation of real‑world assets offers a promising avenue to diversify exposure while maintaining regulatory oversight. Platforms like Eden RWA demonstrate how fractional ownership of luxury properties can be made accessible to retail investors, providing both yield and experiential value within a compliant framework.

Disclaimer

This article is for informational purposes only and does not constitute investment, legal, or tax advice. Always do your own research before making financial decisions.