May 7, 2024

Can Tokenization Save the Economy?

News in RWA

Tokenization is a term, that refers to bringing assets into a blockchain ecosystem. This method of digitizing assets continues to grow in popularity due to its added benefits.

Here’s why tokenization might be the best solution for a broken economy:

What is Tokenization?

The concept of tokenization has been around for many years. However, earlier attempts lacked the technical and legal support to make the theory work. Recently, these roadblocks to wide-scale tokenization have been reduced or removed for most people. As such, tokenization is now a readily available service.

What Problems Does Tokenization Help Solve?

There are many problems that tokenization helps to alleviate for the market. For one, assets on the blockchain are easier to verify. Anyone can conduct a scan using a free block explorer and see the status of an asset in real-time. As such, tokenization provides more transparency.

Financial Barriers

Another major benefit of tokenization is the reduction of financial barriers. The use of fractional ownership tokens allows large investments to be broken into smaller tokens. This approach enables more users to participate in premier investments and improves the ability to diversify your holdings.

Middlemen Fees

Another issue, that tokenization reduces is the middleman fees. Once an item is tokenized, smart contracts can be used to automate core processes of future transactions. For example, you could have a tokenized car title loan.

After the loan requirements, the title could automatically be released to the new owner. This strategy reduces error, lowers middlemen fees and provides near-instant finality on global transactions.

Censorship

The traditional market is notoriously difficult to enter and a person can get denied access to certain investments simply because they are in a country, that argues with another country. Sadly this form of investment censorship is just one of many ways, that the elite keep you away from prime investment options.

Tokenization Benefits

There are many benefits, that tokenization brings out in the market. For one, it opens the door for the creation of completely new and innovative markets. You can tokenize anything.

As such, you can tokenize real-world assets, digital assets, financial assets and even items such as equity and debt.

Global Economy

Tokenization opens the door for a truly global economy. Savvy investors will continue to use tokenization to access the most exclusive projects globally, In turn, more users will tokenize assets to gain access to the digital economy.

Better Trackability

Tokenized assets can be tracked and monitored with more precision. The decentralized nature of blockchains means, that network users gain instant access to token statistics, when required.

Tokenized assets are easier to ship and cost less to track as well.

Combining tokenized assets with IoT (Internet-of-Things), tech and other sensors, that improves efficiency even further. These sensors constantly monitor assets to ensure their quality, location and authenticity.

These benefits are crucial for time-sensitive items, such as medications.

Is it hard to tokenize assets?

Many people are surprised to learn, that tokenizing assets is easier than ever. There’s been steady development in terms of streamlining these processes and for the first time, no coding or blockchain experience is needed to leverage these features.

On most tokenization platforms the process is as easy as uploading crucial data and awaiting the token creation.

Types of Tokenized Assets

There are many different types of tokenized assets available today. Each of these digital representations helps to improve security and enable users to conduct direct peer-to-peer transactions and save.

Here are the most popular types of assets people tokenize nowadays:

Digital Assets

It’s easy to find tokenized digital assets in the market. There has been a strong push to bring the art and music industries into the blockchain fold. As such, it’s common to find tokenized artwork and music. These items are easy to tokenize, as they only need to be uploaded to be converted into the chain.

The tokenization of digital assets has altered the market considerably. For the first time, it’s easy for anyone to verify the authenticity and scarcity of a digital asset in real time.

This capability has led to more users seeking to integrate tokenization into their strategies.

Real World Assets

Tokenizing real-world assets has been a dream of developers since day one. To tokenize a real-world asset there are a few additional steps compared to digital assets. When you tokenize a real-world asset, you are bringing its ownership onto the blockchain. As such, whoever owns the item’s token, has true ownership over the asset.

Blockchain developers have long sought to bring tokenization into multiple industries. The real estate industry was one of the first to experiment with tokenization. The maneuver made sense, as it enabled the seller to tokenize their property and offer it in fractional tokens.

This approach makes it easy for anyone to participate in the sales event. It lowers the financial and legal entry bars as well. This strategy can also help to improve diversification. Additionally, it opens the door for the creation of new markets. As such, tokenization of real-world assets is seen by many as the future of blockchain tech.

A Huge Market to Service

When you review the market, it’s easy to see there’s limitless upside potential. Already, analysts have predicted the tokenized real-world asset market to hit $10T USD by 2030. This growth will be assisted by further integration and the introduction of AI-powered tokenization systems.

Tokenization Service Providers

There are many tokenization platforms available today. Notably, each of these networks specializes in tokenization of specific assets. As such, each is better suited for different approaches. For example, you can use OpenSea to tokenize a song or artwork you have with ease.

OpenSea

OpenSea is an NFT (non-fungible token) marketplace. This hugely popular platform offers a combination of features that make tokenization easier and more lucrative. Artists can convert their digital images, music and videos into NFT tokens using the interface.

These tokens can be sold, traded or staked.

RWA Inc.

RWA Inc. seeks to make tokenizing regulated assets as easy, as digital ones. The platform is the first fully licensed tokenization option to launch and has seen considerable momentum. The network combines various helpful features including easy tokenization, regulatory approval and a community of like-minded and skilled users.

RWA Inc. streamlines the core processes of tokenizing real-world assets. As such, anyone can tokenize homes, cars or any other asset in minutes. As the fastest-growing tokenization community in the market, RWA Inc. remains positioned to help usher in the digital economy.

Tokenization - A Digital Revolution

Tokenization offers so many benefits to the market. It’s secure, safer and more versatile, than the status quo. Additionally, it’s easier to monitor and authenticate tokenized assets. All of these factors continue to draw more users towards the tokenization movement.

As such, those trading tokenized assets are ahead of the curve and positioned for success.

Learn about other amazing RWA Inc. news and partnerships here.