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  • Tokenization is not making tokens: the importance of changing the market mindset

Tokenization is not making tokens: the importance of changing the market mindset

There are thousands of tokens spread around the world, each with its own purpose and functionality, but when the market unites in a collective purpose of disseminating the immeasurable vocation of this platform, the true goal of tokenizing can revolutionize society’s way of dealing with money.

It is impossible to continue ignoring the universe of tokenization and digital assets. The adoption of the market by the central bank brings close the paths of fact for large companies, and the growing appreciation of cryptocurrencies, in addition to the security and ease of transactions are some of the factors that are attracting more and more attention to this form of decentralizing investments.

Tokenization works by transforming an asset into several digital fractions using blockchain. This transformation gives rise to a token, the digital representation of this asset, be it money, a right or a property. By legally structuring a tokenization operation and creating fractions of the asset, it is possible to trade anything in a cheaper, more practical and decentralized way, from a variety of financial products to real assets.

Understanding how the market works is important to know its countless possibilities that, nowadays, go far beyond the traditional offer of credit. However, tokenizing is not just about making tokens.

The discussion in search of evolution is the gateway so that in a few years, everything becomes simpler. The tokenization infrastructure is complex and very well structured product by product and changing the market mindset by understanding this applicability is true tokenization: a process of creating new legal and technological structures to be applied in the regulated market with the mission of spreading the importance of innovation together. The corporate world needs to understand that this is not competition, but an environment that everyone will use, with room for each project to leverage within their respective segments.

In addition, it is necessary to focus on infrastructure. The next generation of securities and asset tokenization requires regulatory standards around the world. For a real transformation process along this path, institutional reorganization is needed for companies to get involved.

In this tune, within two years, the token will become the new normal, even ceasing to be called a token and replacing the standard. Just like, for example, we used the Blackberry in 2010 and in 2012 we started using smartphones. The market will migrate in the same way and the popularization of tokenization already brings advantages that include automation, cost reduction and decentralization of processes, from custody, compliance, transaction, verification and control of assets, that is, it guarantees greater liquidity between the ends.

The mission of tokenization is disruptive and offers a world full of new possibilities. According to a study by Bernstein, which has $3 trillion of investor assets under management, tokenization should move $5 trillion in business by 2028. For this estimate, the company considers the tokenization of various assets, such as government bonds, shares and corporate debt securities, real estate papers and even digital currencies.

Currently, tokens have been causing important changes in the financial market and stimulating various discussions around the world, especially about their use and legalization. After all, until today many exchanges have been offering assets without ballast and guarantees for the investor and tokenization through companies that focus on the evolution of the market works to prevent this from happening. There are thousands of tokens spread around the world, each with its own purpose and functionality, but when the market unites in a collective purpose of disseminating the immeasurable vocation of this platform, the true goal of tokenizing can revolutionize society’s way of dealing with money.

*Cássio Krupinsk, CEO of BlockBR

Source: Cointelegraph

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