8 Features Of The Upcoming Tokenization
This series of articles dedicated to tokenization is now coming to an end. In the final part we will discuss the features of developing tokenization and how the introduction of blockchain will affect its participants and their related industries.
If you haven’t read part 1 and 2, click here:
The Interest of Cryptocurrency Holders
On the one hand, the development of tokenization will obviously decrease the importance of transferring digital money to fiat money. On the other hand, tokenization development will increase the variety and flow of cryptocurrencies and fiat money, and cryptocurrency holders will therefore be incentivised to buy traditional assets. This will strengthen the linkages between the world of blockchain and traditional economy.
Tokenization of Assets will be Costly but Profitable
For the system to work, we need to ensure the correct interaction of a large number of components, such as depositaries, cadastre chambers, archives, dealers and distributors, KYC, escrow agents and so on. This means that tokenization will be relatively expensive.
But it is more than fair to say that tokenization promises excellent financial opportunities. There is a whole army of organizations interested in the transition to blockchain. For example the DTCC, Nasdaq, and Moscow exchanges have already announced they are testing blockchain technology to create distributed ledgers.
The Rise of Capitalization will not Affect Every Tokenized Asset
Tokenization of intangible assets (such as audio and video content) may decrease their cost and improve their availability, which will be convenient, but not profitable. The most productive tokenized assets will be real estate, transportation, and mining operations.
The Development of Smart-Contracts May Regulate the Market
With the help of the smart-contracts code, it will be possible to prevent market manipulation, financial mismanagement, corruption, and money-laundering. Smart-contracts will also solve problems such as misdirected transactions, transaction repayment, and public keys loss.
The number of smart-contract-backed blockchain projects will grow, and the majority will develop their own distributed ledgers. This will lead to a common linkage and governing system.
Cryptocurrency Popularization
The development of the crypto industry has resulted in the wide expansion of its audience. In the beginning it was the exclusive territory of advanced internet users and programmers, but now blockchain is increasingly recognized by regular people, which increases the overall attention paid to cryptocurrencies.
New Professions
The evolution of new occupations is a long-term trend, but even today it is clear that blockchain and IT companies have a high demand for highly-specialized employees with knowledge in programming, economics, finance, and mathematics. Soon enough car dealers, real estate agents, traders, bankers, directors and senior executives will have to know about the blockchain ecosystem, just like they are currently adapting to internet-marketing.
It is also important that the functionality of people involved in the blockchain ecosystem moves from direct sales towards expertise and control. This will have a positive effect on transparency and the integrity of a business linked with blockchain.
Data Storage
Tokenization of assets requires the formation of registers, depositories, and companies that store the data and rights concerning real estate and equities, among others. This process requires a tremendous amount of work, as the cost of tokenized assets will exceed trillions of dollars.
Internet of things (IoT)
With the development of tokenization, related industries like IoT production will progress too. The IoT is made up of sensors and smart devices that automatically count, weigh, identify and transfer information to the decision center.
Nowadays there are no technical problems to start the mass production of IoT devices. The largest IT-companies like IBM and Intel have developed the new generation of smart sensors (RFID) that are utilized in transport and logistics. RFID sensors transfer data to blockchain and make cargo transportation more transparent.
BANKEX has developed a unique Proof of Asset protocol that will benefit not only the blockchain industry, but also the traditional world of finance. Tokenization of assets will provide important opportunities for related industries as well as important connections between the blockchain and fiat economies.
