The asset management industry is going through a transformational shift with the emergence of distributed ledger technology and tokenization of assets on top of blockchain technology.
Asset tokenization help converts the rights to assets with economic value into a value-backed digital token.
The asset tokenization on top of decentralized or distributed ledger technology help democratize access to the valuable asset-based markets and is offered with ingrained security capabilities.
Immutability, accessibility, divisibility, cost-effectiveness, and transparency are a few of the most significant benefits of asset tokenization.
Pioneering Industries Embracing the Potential of Asset Tokenization
Financial Services
Be it – Margin lending, product structuring, investment, or payments, each aspect of the financial industry is directly impacted by digital asset tokenization services. Tokenization of financial assets allows companies to interact with their shareholders by providing information on a single shared and immutable ledger. With the help of DLT, shareholders will have ownership transparency and authenticity to run trades on the secondary market.
Real estate property
The real estate property market is one of the noteworthy examples of fractional ownership. Real estate asset tokenization companies open the doors for increased market participation and high-value investments. Tokenization offers exciting opportunities to expand real estate investment markets with the help of fractional ownership.
Artwork Industry
Today, artists do not require renowned galleries to display their artwork and present it to potential buyers. Asset tokenization companies enable artists to sell their artwork themselves by tokenizing them. Such tokens are unique and non-replaceable.
Sport Industry
The sports industry has touched millions, even billions, of people worldwide. A blockchain-based asset tokenization platform can decentralize the sports marketplace.
It enables the investors as well as desiccated fans to fund and invest in their favorite sports players and preferred sports teams or clubs.
In addition to that, the fans can trade their investments for profit on decentralized exchanges. It will also provide players an opportunity to connect with their fans on a personal level as well receive financial support that can motivate them to perform more effectively and profitably on the field.
The two major types of Asset Tokenization products are:
Utility Tokens
Utility tokens are generally promotional tools for blockchain-based projects that grant holders special access or promotions for future product or service launches. Utility tokens are specifically used just to operate inside a closed blockchain ecosystem and are not designed as investments.
Security tokens
Security tokens represent ownership shares in a company or an asset that does business using blockchain technology. In other words, it is essentially a digital form of traditional securities. Investors can expect to profit from security tokens as they are the economic units for operations running on top of the blockchain.
Security tokens come with a myriad of benefits for entrepreneurs and users. The major benefits include increased crowdfunding opportunities, lower barriers to market entry, improved liquidity in the processes, and better employee management systems.
A sneak peek into the back-end operation
Distributed ledger infrastructure is mandatorily required to tokenize an asset. The most crucial element of asset tokenization is the smart contract.
To transfer payments and legal rights of tokenized assets from one party to another, a base layer of protocol consisting of a chain of smart contracts is required.
With the underlying blockchain infrastructure, cryptographic wallets are also needed to store your tokenized assets in a secured format, or else you can store them directly on the asset tokenization platform itself.
Additionally, asset trading platforms are necessary to trigger the whole buy and sell mechanism of assets.
Advantages of Tokenized Economy
With asset tokenization, a new innovative Business model can be formulated from scratch with ease. Tokens can be introduced to the customers that promote the use of the business as well as create economic incentives for the customer to support.
Additionally, an asset tokenization platform can help distribute the functional features of the business among even more entities preferably redundant and permissionless using blockchain technology to increase the reliability of the business project.
The distributed ledger technology offers incredible production against Cyber risk. Cyber security is effective because it is built on top of the concept of consensus and cryptography.
On the other hand, the asset tokenization platforms offer an additional layer of security by taking the right cyber security measures in the actual process of tokenization of intellectual/ physical property at several different layers.
One of the prominent examples of the tokenized economy is the real world asset NFT or physical NFT. NFT is a method of using legal and software engineering techniques to tokenize valuable property. The property could be digital or physical.
The token can be traded, collateralized, governed, and owned using the underlying blockchain – the universal medium of value transfer that powers the entire crypto economy.
With the rise of the metaverse, the potential of NFT is now being realized on a global scale by most mainstream companies. Moreover, NFT will play an important role in the further development of metaverse and in the future of digital assets.
Conclusion
The traditional concept of asset ownership is changing with the emergence of blockchain-based digital asset tokenization services – a brand new category of cryptographic financial services and products. From stocks to real estate properties to gold, literally, everything can be tokenized.
The aim of asset tokenization companies such as YodaPlus is to democratize access to expensive assets that only very few can afford. On the other hand, traders or investors can diversify their assets portfolio by exposing themselves to a little less risky investment.
Yodaplus digital platform is a bridge between the traditional (and digital) assets marketplace and innovative distributed ledger technology or blockchain industry. We offer a state-of-the-art blockchain solution for enterprises that include blockchain consulting, development, and maintenance services, including Defi Dapp development and feature-rich custodian platforms.
Yodaplus value-stack encompasses asset tokenization services. With the help of our pioneering digital asset tokenization platform services, we can help you to tokenize your valuable assets without dealing with technical complexities.
Our asset tokenization services take advantage of the revolutionary distributed ledger technologies that imbue more transparency, trust, and efficiency in the asset tokenization process.
