The blockchain technology that came into existence almost a decade ago was just limited to cryptocurrency in its early days. Over time market realized its potential use cases and we saw many new inventions and technological applications being built on blockchain.
The technology kept evolving, and one relatively recent advancement that came out of these advancements is asset tokenization.
It won’t be an understatement if we say that tokenization of assets is disrupting the financial industry. From real estate to the entertainment industry, the tokenization of assets is a growing trend.
A brief guide to Asset Tokenization, Industries involved, and market expanding
In simpler terms, asset tokenization is converting real-world assets into digital form or digital assets.
Features such as the highest level of security, immutability, and ease of access are perfect when combined with the buying and selling of digital assets.
Tokenization of assets offers increased liquidity, has fewer costs, and faster transactions. The process is favorable for both; the buyers and sellers. This is why the concept of tokenization is growing, and investors are now investing in various industries involved in the tokenization process.
Why is the market shifting toward tokenization?
In markets such as real estate, you have to deal with real estate agents, listen to their selling pitches, and pay them a commission. With tokenization, the mediators’ concept is eliminated, and you interact directly to buy an asset, and the process is entirely transparent with an immutable record!
An investor who is interested in buying a property does not need to go to the place; he or she can invest in the property from anywhere in the world where the technology is available.
In the traditional investments process, it is not possible that you like an expensive property, but being low on the budget, you decide to buy fractional ownership. In tokenized assets, you could buy a small portion of assets that could be the smallest percentage!
Industries that are leveraging the asset tokenization
With all the advantages discussed above, various industries are now using the blockchain for tokenization of assets. Let’s discuss a few prominent ones.
With all the discussions regarding climate change and global warming, waste management carries major importance these days. The industry is pushing towards tokenization solutions to facilitate business to optimize the recycling process by removing intermediaries and making the process easy and fast. One example in this regard is an initiative by Plastic Bank where the company trades plastic waste in exchange for digitalized tokens.
Aviation is a vast industry that could be benefited from blockchain and tokenization of assets. Tokenization of assets in the sector could help ease the accounting and reconciliation and help prevent digital assets from being double-spent.
The tokenization process is usually carried out using STOs, i.e., Security Token Offerings. A legal and regulated mechanism that allows the investors to purchase tokens securely and safely.
STO’s are a relatively new advancement in asset tokenization, but they are growing rapidly and are adopted by various industries.
Following are the upcoming STOs listed as listed on STOScope:
Upcoming Finance STOs
- LXDX from LXDX Ltd.
- BlueOcean Ventures BOV from SwissVCToken Pte Ltd
Upcoming STO in Healthcare Industry
- 7Pass from 7Pass Holdings, S. A.
The Bottom Line
Seeing the tremendous growth in blockchain technology in the recent past and introducing revolutionary technologies such as Smart Contracts, Asset Tokenization, and security token offerings, the future of digitalization of assets seems promising.
Are you interested in learning more about STOs? Stay in touch with us at stofilter.com!
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