I came across a quite interesting design—a certain RWA protocol can handle stock token trades of $100,000 per transaction, but the on-chain liquidity pool clearly isn't that deep.

Their approach is actually quite clever: they issue a stablecoin called USDon as an intermediary layer. When someone wants to buy stock tokens, the protocol directly mints new tokens and uses USDon as a bridge to complete the exchange. Since both stock tokens and USDon are controlled by the protocol, in theory, they can have as much liquidity as they want😂.

This mechanism bypasses the dependency on external liquidity, but essentially shifts the liquidity risk to the protocol’s credit backing. It's a trade-off solution found on the path to real-world asset (RWA) adoption.