# 0xngmi on X: "The problem in RWA Metrics"

Source: https://x.com/0xngmi/status/1966798227870556567?s=46&t=WxosQA87X71aATD1nduqbg

## Summary

DefiLlama says it has not listed Figure's RWA products because its due diligence found the claimed $12bn in on-chain RWAs hard to verify, not because of Figure's Twitter following as a rival claim suggested. The article, written by the DefiLlama side, says Figure had only about $5m in BTC and $4m in ETH deposited on its exchange, and its YLDS stablecoin had about $20m in supply. It also says DefiLlama disputes claims that it charges listing fees, stating it has never asked for or received payment for listings.

## Article

TLDR: Figure wants us to skip our due dilligence with them, so they are trying to pressure us by slandering us publicly and privately. In this article I debunk their statements.

Fake metrics in RWAs

With DeFi apps anyone can verify TVL by looking at the chain and the assets deposited on contracts, however for RWAs that verification is not possible, these are much more opaque and this has led to a rise in RWA projects that inflate their TVL.

One example of this is that when you go to rwa.xyz you’ll see that they have ZKSync as the top #2 chain by RWA value, with a huge gap vs all others. However I bet nobody who’s reading this is holding a RWA on zksync, so what’s going on?

This is the largest asset on zksync according to them, sitting at 235M mcap: https://era.zksync.network/token/0x6ff4fafd8d604614c704a5936d9146c0af19bd1e#balances

This token has 11 holders and since it was created, 300 days ago, it hasn’t ever been transferred between addresses or swapped. All the activity is a total of 31 transactions where the issuer mints tokens to an address or burns them from an address, and all the holders are just dead addresses with 0 lifetime transactions, that don’t even have gas to transact.

Second biggest asset (https://era.zksync.network/token/0xac4de1e9a9e83524f24af77972dd39d588de8164) at 202.5m is the same thing, only 10 holders and no activity between addresses since it was created, and so on for the vast majority of RWA TVL on ZKSync.

So what’s the point of this? The issuer here just has an internal db and is simply mirroring that db into the blockchain to some addresses with 0 activity, so any new changes to db just simply get pushed to the blockchain and that’s it. I think these are likely not even bearer assets.

Another case similar to this was a company that minted themselves a token that was all owned by themselves and said “this token represents equity in a company and we value this company at 500m, so we’re requesting to be listed as a RWA issuer with 500m TVL”, the token was not tradeable and nobody owned it, it was just 100% of the supply sitting on their own address.

I’m not sure if companies are doing that to inflate metrics, to claim theyre working with blockchains, or some other reason. But when users think of RWA they think of Stocks that they can buy, or tokenized houses, or any financial asset that can be transferred or swapped on the chain, and this is clearly not what’s happening here.

The value in DefiLlama is that users trust us to provide them good data, so if we listed this and said “look ZKSync has 10x the adoption of Solana in terms of RWAs”, when on Solana people are trading stocks, holding them… and on ZKSync its just a db being mirrored with no activity whatsoever, not even a single transfer, we’d be doing them a disservice because users then might invest in ZK based on the thesis that RWA adoption is 10x better than solana, and then they’ll get rekt because that thesis is wrong.

Furthermore TVL is used as a metric for how much trust the market places on a project, what’s at risk in it, and for cases like this where its just an address minting and burning tokens to 11 empty addresses there’s no risk involved, if anything bad happened they’d just cancel the blockchain part of it and that’s it. This betrays the usage of TVL as a trust metric.

So for us it’s very important that we provide good data that matches our user’s expectations and that allows them to make good decisions. We take user trust very seriously and we want to ensure our metrics reflect reality.

This lead to people frequently assuming that defillama’s RWA data was incomplete when comparing to RWA.xyz since their numbers were much larger, but the reason was that they take an approach of listing everything while we purposefully didn’t list the projects above to make our data on RWA adoption more accurate. Their approach led to their data stating for years that Provenance was the top #1 chain in RWA adoption, way above Ethereum and every other chain, despite every institution launching products on these other chains. Now they’ve reversed that decision and removed it, but they still have ZKSync as their #2 chain in RWA adoption based on the tokens I discussed before.

This is the reason why for RWA’s we spend lots of effort in due dilligence, we check everything on the chain, we verify the backing of the RWAs to make sure it’s real…

Due dilligence on Figure

Figure claims that they have 12bn in RWAs issued on chain, but when we looked into it we found some things that seemed weird:

There was only 5m$ in BTC and 4m$ in ETH deposited on their exchange (BTC only had a 24h volume of 2k$)

Their own stablecoin, YLDS, against which all trades of their RWAs should be getting done, has only 20m in supply

Most of the transactions that move their RWA assets seem to be done by a different account that the one that holds them

The vast majority of process in their loans is done in fiat, and we could barely find any  onchain payments

So we’re unsure how are 12bn in assets being traded when there are so little assets in the chain to trade them against. As it seems that a majority of holders are not transferring these assets with their keys, are they just mirroring their own internal db into the chain?

We had been digging and sharing these in a telegram group chat with their team for quite a while now as part of our due dilligence, and when they submitted a PR, our dev asked a bunch of questions around issuance, how their system works… and among these questions said that it seems very strange that they have 12bn in TVL with so little presence of twitter and we needed more details from them to verify the data.

Then a guy who has been in this group chat for months, who has seen the entire due diligence process and the questions we’re asking, goes and tweets that defillama is refusing to list figure because their twitter followers. Then over the following days I get people from a bunch of major crypto institutions and VCs reaching out privately to defillama and our partners (who then forward it to me) asking why are we refusing to list figure because of their twitter followers.

What a clown world, the guy clearly knew the reasons for the due diligence and then goes out, makes up this lie and tries to get everyone to bully us into skipping our process to list them so they can pump their metrics for their IPO. And now I’m spending my friday night writing an article saying that no, we didn’t refuse to list a project because the number of their twitter followers.

The cherry on the top is that the CEO of their partner chain then suggests that we are charging listing fees, which is a complete lie. We’ve NEVER asked nor received payment for listing. And we’ve lost a lot of money for that.