Tokenized Gold Coming To Cardano

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Tap In With TapTools

6 min read4 days ago

9/23/2023

Real World Assets (RWAs) are emerging as a hot topic and a potentially strong narrative for this bull run, with major backers like BlackRock driving interest in the space. By bringing tangible assets into the digital realm, RWAs could reshape the way investors manage value, offering new opportunities within decentralized finance. This article will delve into RWAs, their benefits, on-chain gold coming to Cardano, and more.

What is RWA?

Real World Assets (RWAs) are tangible, physical assets such as real estate, commodities, or bonds, that are digitally represented on the blockchain through tokenization. This process involves creating a digital token that represents the ownership or value of a real-world asset. Tokenizing RWAs enables the integration of these assets into the blockchain ecosystem, transforming the way they are stored, tracked, and transferred. Unlike cryptocurrencies, which are purely digital, RWAs are backed by tangible assets in the real world, linking the digital space with real-world economies.

Tokenized RWAs maintain all the legal rights and ownership claims of the physical assets, which are reflected in the smart contracts governing their digital counterpart. This digitization process unlocks the potential for automated asset management and seamless integration with decentralized finance (DeFi) applications. The immutable nature of blockchain ensures that ownership and transaction history can be securely tracked, providing a new level of transparency and security for managing these assets.

Benefits of RWAs

Tokenizing Real World Assets (RWAs) streamlines asset management by reducing the need for intermediaries and cutting transaction costs. It also enhances global accessibility, allowing users to access previously illiquid markets. Traceability is another key advantage, as blockchain technology provides a transparent, immutable record of all transactions, reducing fraud and improving compliance. Additionally, RWAs bring liquidity to traditionally illiquid assets like real estate or commodities, allowing fractional ownership and faster settlement times. This opens up new opportunities for investors seeking diversification and risk management strategies through stable, real-world value on the blockchain.

Tokenized Gold on Cardano

Multiple protocols are working tirelessly to bring gold to Cardano as the next tokenized Real World Asset. This will allow ecosystem participants to gain on-chain exposure to gold without owning the physical asset, providing opportunities for hedging against inflation or using it as a reliable store of value during uncertain times. Gold, with a market cap of over $12 trillion, has long been a hedge against market volatility and inflation, particularly during economic downturns. We’ll now delve into a few on-chain gold offerings you can look forward to in the near future.

Finest

Finest, an RWA Tokenization Platform announced on September 2nd, 2024, that gold will be the next tokenized asset on Cardano and can be expected sooner than most think. This platform is a joint venture between NMKR, IAMX, and FluidTokens, with each entity bringing a key component to the partnership that enables it to deliver a secure, compliant, transparent, and user-centric experience Real-World Asset protocol to the Cardano blockchain. Details of the on-chain gold offering have not been announced yet however Finest suggests following them on X and turning on notifications.

You can learn more about the Finest platform here: https://www.finest.investments/

Emurgo X Unbanked’s Kinka Gold

Last week, the Cardano community saw an exciting announcement from Emurgo, bringing on-chain gold to Cardano through a partnership with Unbanked’s Kinka Gold, a subsidiary of Unbanked. Unbanked in Japan is a fintech company providing innovative financial services through blockchain, specifically tailored for users who are outside the traditional banking system.

Their offerings include Kinka, a gold-backed cryptocurrency for tokenized gold investment; Crowdbank, a loan-based crowdfunding platform giving retail investors access to diverse opportunities like real estate; and Personal Capital, a corporate lending service supporting business financing. Together, these services bridge the gap between traditional finance and the blockchain economy, offering users access to secure, liquid, and scalable digital financial tools.

In this partnership, Emurgo will develop an asset tokenization platform where Kinka (ticker: XNK) itself will be deployed on Cardano. Each XNK token is backed by gold and will represent one ounce of premium Japanese gold that meets all London Bullion Market Association (MBLA) standards. Each token represents ownership of a fraction of gold stored securely, allowing holders to gain exposure to gold’s value without needing to handle the physical asset. As it integrates with Cardano, Kinka will benefit from the network’s scalability, security, and smart contract capabilities, making it a unique offering within Cardano’s growing decentralized finance (DeFi) space.

You can find out more about Unbanked’s Kinka token here: https://unbanked.jp/solutions/web3

TVVIN

TVVIN is an RWA Platform that leverages blockchain technology to enable investment into tokenized Real World Assets. Gold will be the first precious metal supported on TVVIN followed by silver, platinum, and palladium. The project recently shared a preview of its Institutional Platform UI which can be viewed in the X video below.

You can find out more about TVVIN at the following link: https://www.tvvin.com/

How Will this Benefit the Cardano Ecosystem?

Integrating Real-World Assets (RWA) into Cardano’s DeFi ecosystem can unlock new investment opportunities within Cardano’s Decentralized Finance ecosystem and add additional stable value within DeFi protocols. Tokenizing assets like real estate, commodities, and bonds can attract more liquidity and ecosystem participants. Cardano’s strong security and zero downtime ensure that investors looking for exposure to RWAs will always have access to their investments, making it a reliable platform for institutional finance. This could position Cardano as a key player in attracting institutional adoption and expanding real-world use cases.

Conclusion

This article is strictly for informational purposes and does not constitute a promotion or financial advice. Our aim is solely to provide users with the latest news and updates within the Cardano ecosystem.

We hope this helped you get caught up with the most recent crypto news. If you enjoyed the read make sure to follow TapTools on X and join our Discord.