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6 advantages of asset tokenization for your business

While people and companies still assimilate such disruptive concepts as cryptocurrencies and decentralized finance , innovations arise from them – one of them is asset tokenization , a revolutionary way of doing business.

A token is the digital representation of an intangible asset – trademarks, copyrights – or physical – real estate, capital goods, collectors’ objects, among many other options.

In this way, digital assets are created that can be traded in single shares or in fractions ( tokens ) that make it possible to trade goods with relevant values.

These fractions are generated and stored on a blockchain , taking advantage of the simplicity, security and transparency that the network already provides to those who operate with cryptocurrencies .

Tokenization is an important divider in the way of managing asset sales and agility is the first benefit that comes to our mind. However, there are others that are equally important.

Do you know these advantages of asset tokenization ?

In this article, we at BLOCKBR are going to talk about them and help you decide on a step that will completely change the level of asset valuation for your company!

BUT FIRST: 3 FACTS ABOUT ASSET TOKENIZATION

TOKENIZING ASSETS IS NOT JUST FOR BUSINESSES

A natural tendency is to imagine that generating digital assets is something that only companies can do, but it is a process available to anyone.

You can tokenize artwork from your personal collection to earn profits and investors will gain from the appreciation of the assets. It is the same logic of investment and return of the shares of a company, but with the specific advantages in the case of tokenization .

TOKENIZE WITH MODERATION

There is no obstacle to generating digital assets of the most varied goods – from letters of credit to land, through patents, lease agreements, receivables and collector cars.

However, it is important to assess when it is interesting to tokenize .

Generating revenue more quickly and safely is great, but it is necessary to assess the attractiveness of the asset, as this will impact the result at the end of the funding period – the goal may not be reached and you will have put time and expectations that will not materialize.

BLOCKBR has experience in this analysis so that the future token issuer can see the scenario in the most transparent way!

WHAT ARE SMART CONTRACTS?

They are digital contracts created within the blockchain and which support each transaction with a digital asset , where the rights, duties and penalties defined by the token issuer (the asset owner) are established.

They are immutable from the moment the investor confirms the purchase of the fractions and, therefore, provide absolute security to operations. They are also responsible for the electronic distribution of shares to investors and capital to the issuer of the tokens .

1 – SAFETY IN OPERATIONS

All steps of tokenization and asset trading are carried out on the blockchain , a digital environment that hosts the creation of cryptocurrencies and is recognized for being extremely secure – there is no case of hacking recorded in one of them to date.

Some facts confirm this security:

  • It is not possible to change information already stored on the network;
  • A closed contract is immutable;
  • Smart contracts ensure that terms are met;
  • Transactions are made electronically between the asset owner and investors, through their digital wallets and with no third parties involved.

smart contracts advantages

2 – DEMOCRATIZATION OF ACCESS

The tokenization of goods promotes the democratization of supply and also of investment, as there are few restrictions to tokenize assets and fractionation allows more people to invest.

This makes blockchain highly attractive to an increasing number of people on both sides – issuers and buyers – and creates a virtuous cycle with:

  • The possibility for more companies and people to raise funds;
  • The increase in turnover;
  • More credibility in the blockchain and its features;
  • Greater volume of business and potential investors.

This cycle favors your token offerings as more people trust the way tokenization works .

3 – TRANSPARENCY IN TRANSACTIONS

One of the most striking features of the blockchain is the transparency with the transactions that are made on it; they are individually saved and available for consultation.

A token of a property , for example, which represents 1% of the asset, can be traded several times, the entire history is recorded and it is possible to know the current owner of the fraction.

All this transparency is essential to maintain trust in the information that the blockchain generates and manages. In addition, this visibility does not interfere with the security quality of the network.

4 – DIVISIBILITY OF DIGITAL ASSETS

A work of art can be tokenized in 50 fractions, so that the owner of it profits from the token offer , people have 2% of the asset at least and gain from the appreciation of the work in the market.

It is the key to the success of asset tokenization , as it changes and broadens the profile of the public. In addition, there is no minimum or maximum limit to the divisibility of a digital asset , it is defined by the characteristics of the asset, the funding period and other factors.

5 – MORE LIQUIDITY AND EFFICIENCY

Each asset has its liquidity ratio – the speed to transform good into cash – and this impacts company projects and people’s plans, as it is not always possible to generate capital at the desired speed.

Fractionation allows for fundraising[067-002] faster with the attraction of more people to invest when compared to the potential buyers of a property in the traditional market.

With the use of blockchain and smart contracts , tokenization becomes a more agile operation and without the bureaucracy that involves a physical sale.

6 – GREATER PROFITABILITY

Tokenization operations do not involve the payment of bank costs, as they are peer-to-peer transactions – directly between seller and buyer – which improves the end result of the token offering .

With all the advantages of tokenizing goods that we have presented in this article, we can see that it is an operation:

  • Attractive to a wider audience of people;
  • That doesn’t just depend on big investors;
  • Safer;
  • More agile in fundraising;
  • No bureaucracy and sales costs;
  • More rentable.

You can put your business in the era of tokenization and boost cash for new projects!

BLOCKBR Digital Assets is a fintech that combines technological innovation and digital knowledge to transform physical assets into digital ones, in the asset tokenization process.

The offer of tokenized physical and financial assets, both current and new, is democratic and decentralized, which makes investing safer, simpler and more efficient.

We enable, structure, issue and offer tokens on our platform and beyond. Be aware that tokens depend on feasibility and regulatory factors.

Do you want to tokenize your business or part of it? Do you have a business solution and does it make sense to issue your own token ?

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