Tokenization reimagines asset management by digitizing ownership and rights to assets such as stocks, bonds, and real estate. Traditionally, managing these assets is cumbersome, involving intermediaries and complex paperwork, making processes slow and sometimes opaque. Tokenization converts physical assets into digital tokens on a blockchain, offering a more efficient and transparent method for ownership transfer. Tokens can represent ownership shares, utility access, or unique items, and are categorized broadly into utility tokens, security tokens, and non-fungible tokens (NFTs). Utility tokens provide access to services, while security tokens represent investments and must comply with existing security regulations. The blockchain technology that enables tokenization first emerged with Bitcoin, which paved the way for Ethereum to introduce smart contracts, enhancing the potential applications of tokens. Despite challenges like regulatory scrutiny, the promise of tokenization lies in democratizing asset access and improving accountability, security, and fraud prevention. As innovations continue, the scope for tokenization is expanding to revolutionize the trading of both traditional and digital assets.

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