Asset tokenization platforms enable individuals and organizations to create a digital proof of ownership for real-world liquid assets such as capital or property. These asset-backed tokens differ from security tokens in that they carry real-world capital and liquid value. Digital assets offer a flexible system for managing various digital assets and facilitating transactions. Once assets are tokenized, they can be used for transactions across the world without the need of a middle man (such as a bank or institutional trader).
Companies choose to tokenize assets to guarantee ownership of assets, increased protection, and lowered risk.The immutable, public nature of blockchains and distributed ledger technology ensures that once an individual gains ownership of an asset, that ownership cannot be altered or deleted without another transaction. Other benefits of digital assets include virtually borderless international trading, fractional ownership, and speedier transactions.
Asset tokenization is fairly unique and does not have much overlap with software solutions outside of the blockchain world. Still, in some industries (real estate, for example), vertical solutions have emerged for managing assets with blockchain technology.
To qualify for inclusion in the Asset Tokenization category, a product must:
- Be built upon on a blockchain-based platform or distributed ledger technology (DLT) system
- Issue digital tokens that represent real-world assets
- Assist with the evaluation and pricing of assets
- Generate smart contracts for investors
