Would you swallow the first tablet from the store window in the pharmacy? And what if you knew all about its composition and dosages? Or this pill would be kindly written out to you by your doctor? As you can see, the tablet itself has not changed in any way, but due to the available information its value in your eyes has increased. So, the fact is that many financial assets today are similar to this pill: you simply do not know much about them. But this problem is called for in the near future to solve tokenization.
But first let’s talk about the assets themselves. Being a regular ordinary client, we are forced to go through all the circles of hell in the form of identity checks and the solvency of clients, every time we open one or another account, sign a contract or pay a commission. The same applies to investing. Thus, strict regulation of the market has led people to demand alternatives. This alternative was the crypto-currency market. People were able to freely enter and withdraw their funds, and the number of ICO at the same time increased to about several hundred per month.
It is necessary, however, to note that the investment in unregulated assets of the adventure is still the same, because in China alone, the level of fraud reaches 90 percent. But even despite such conditions, assets still remain attractive to investors and with each month only become more popular.
The main barriers to opening accounts are usually: bureaucracy, inconvenient software for trading, the need for cooperation with intermediaries and low transaction speed. If you talk about tokens, the term itself arose in the blockchain industry, where account balances were called tokens. In simple terms, tokenization is simply a change in the way of storing, as well as asset management, in which each asset receives its digital identifier. Tokenization enables the owner to manage assets himself without any intermediaries.
It is very easy to explain on the example of the banking system and bitkoynov. If a person wants to perform some kind of operation with his account, he needs to get in touch with the bank, identify there with a login and password, and wait until the organization’s employees fulfill his request. In Bitcombies, everything is simple enough: one digital signature suffices for the transaction to be executed.
The same mechanism can also be used to manage traditional assets. Yes, you need to make some changes to the infrastructure, but you can not deny the benefits that this will give. Tokenization will help to reduce costs, increasing speed and, not least, security of transactions. Blocking will allow to distribute all important functions for storing and processing information between all parties. This is ultimately designed to make the system more stable. Also, you do not need to trust the centralized service providers for nothing, since all parties can have real-time access.
So, what do we have by switching to tokenization? Among the obvious advantages, of course, are the increased speed, security and comfort of transactions, as well as no intermediaries. But there are other pluses. For example, you can track the transmission history, divide assets and integrate management principles.
One of the practical scenarios. Let’s say you need to vote for something. With the help of digital tokens people do not have to meet live or make contracts. All this makes neftenizirovannye assets as valuable as tablets without the information about them.