Friday, December 2, 2022

Top 4 Use Cases Of Tokenization


Securing data is vital for any industry that works with online exchanges. Thus, we need a robust security framework that allows us to perform online transactions as well as protect shared information. This is where Tokenization comes into play. Currently, Tokenization is being used in a large spectrum by minor to medium-sized businesses to safeguard their e-commerce transactions while being respectful to government norms and business standards.

Top 4 Use Cases Of Tokenization

Tokenization works on blockchain-based systems and is capable of further development. Now, let us look through the top 4 use cases of Tokenization. 

Table of Contents

  • Tokenization of valuable metals  
  • Real Estate Assets Tokenization
  • Tokenization Blockchain uses cases for Artwork
  • Use cases of Tokenization in the Logistics industry 
  • Closing Thoughts

Tokenization of valuable metals  

For a long time, gold has stood its ground as an essential asset and investment. But also, holders and investors experience many complications for storage and shipping gold. Besides, a significant portion of the worldwide gold supply goes under the ownership of public financial institutions as a form of reserve property or brokers filling in as delegates of the sole parties trading gold to investors directly. 

The use cases of Tokenization concerning gold and other valuable metals are properly legitimate looking at the illiquid model of the market for valuable metals. On account of illiquid markets, more prominent corporate companies can settle bilateral agreements while empowering data deviations alongside putting limits on gold value disclosure. 

Probably the most significant hindrance for entering the valuable metals market calls attention to the need for high-value investment. Moreover, the strict worldwide guidelines likewise expect compelling trackability of metals across the entire supply chain from the production phases to reaching clients. 

Additionally, it gives the advantage of fractionalization, which can lessen entry hindrances by enabling more small investors to get to new markets. Thus, the tokenization use cases for valuable metals with expanded market investment and could prompt further better market liquidity. 

Then again, the more considerable number of market members would suggest the development of multilateral exchanges. With Tokenization, support for smart contracts and atomic swapping can guarantee safe and practically continuous settlement of muddled multi-party exchanges. 

The outstanding instances of ventures which guarantee Tokenization of valuable metals incorporate Cache, DGLD, Gold (CGT), and Pax Gold. These projects show the improved decency in gold markets by presenting real-time liquidity and records of even insignificant expenses. However, always take advice from the blockchain professional before performing gold transactions through Tokenization. Also, you can learn blockchain by taking courses on blockchain technology.

Real Estate Assets Tokenization

Tokenization in real estate is the most common way of making fragmentary ownership on an asset with the assistance of blockchain-enabled tokens. It can turn the illiquid real estate assets into a liquid market. A New York-based asset management firm, Elevated Returns, closed its very first tokenization real estate bargain in 2018. The firm did a deal worth 18 million dollars on the Ethereum blockchain for St. Regis Resort in Aspen, Colorado. At first, the firm wanted to sell nearly half of St. Regis Resort as a solitary asset. However, the organization later chose to provide 18.9% ownership via a token sale. This sale is one of the best examples of the Tokenization of real estate assets. You can learn more about the workings of Tokenization and blockchain with affordable courses on blockchain technology.

Tokenization Blockchain uses cases for Artwork

Owners of the art pieces often sell prints of unique artworks by renowned artists. For example, if there are around 1,000 prints of Artwork. Then Tokenization of artwork prints is done by giving particular companies ownership of those prints. The organization then offers the interested buyers to reclaim the tokens for a sole print. After finishing the redeeming process, the organization will send physical Artwork to the given location. 

In case the redeemed token’s worth is not equaled to a specific threshold, then, at that point, the token owner can own a small portion of the art print as per its evaluated value. Take the example of TheArtToken (TAT), which offers tokens that address part ownership of present and Post War Art. The Swiss government ensures the first actual artworks are stored in a warehouse. Such Tokenization of art simplifies it for third-party markets and purchasers to make a profit by owning parts of artworks. As per blockchain professionals, Tokenization for artworks is one of the best applications of blockchain-enabled systems.

Use cases of Tokenization in the Logistics industry 

The Logistics Industry embraces real-world use cases of Tokenization to the fullest. The logistics business relies significantly upon the Bill of Lading as a strategy for giving verification of ownership. In any case, the Bill of Lading comprises many disparities like delivery postponements, lost good recovery, or misplaced Bill of Lading. 

Companies like CargoX offer promising solutions which use Tokenization for resolving such issues in the logistics industry. The organization uses an open framework dependent on the Ethereum blockchain known as the B/L or Smart Bill of Lading. The Smart B/L framework has been customized to function similarly to a token system.    

With such a new framework, the carrier company can easily make the Smart B/L with the companies’ applications. Then, the carrier company can mail the Smart Bill of Lading to the exporter. After getting cash from the shipper, the exporter can shift the Smart Bill of Lading token ownership to merchants/importers. In this way, the merchant at the receiving end can prove ownership over goods by showing a Smart Bill of Lading token to the carrier agent. Hence, it is apparent how Tokenization use cases are bringing positive change in the logistics arena.

Closing Thoughts

By looking at these use cases and examples of Tokenization, we can say that it can bring promising enhancements in business functional ability. Aside from the streamlining business measures, Tokenization can likewise support the improvement of new platforms with associates from various ventures. With the best blockchain technology certification program, become familiar with Tokenization and how it can change the real-world business scenario!

Learn blockchain technology and Tokenization with the best blockchain certification programs at the BLOCKCHAIN COUNCIL. Also, get access to numerous relevant courses.

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Habib Kazi is a General Blogger & writer who has been an expert in the technology field for a few years. He has written several useful articles which have provided exciting and knowledgeable information on Finance, Business, Construction, Tech, Travel, and Sports.