🔍 What Is Asset Tokenization?
It’s the process of representing real-world financial assets (e.g. equities,
bonds, real estate, carbon credits) as digital tokens on a programmable ledger
(blockchain). This enables real-time, transparent, and automated asset
exchange with reduced reliance on intermediaries.
🧩 Five Key Benefits
Identified by WEF
- Shared
System of Record – Single source of truth with real-time visibility.
- Flexible
Custodial Models – From full custody to self-custody via private keys.
- Fractional
Ownership – Democratizes access to traditionally illiquid markets.
- Composability
– Seamless multi-asset operations and collateral reuse.
- Programmability
– Smart contracts automate transactions and compliance.
💼 Real-World Use Cases
✔ Tokenized sovereign and corporate bonds
(EIB, HKMA, UK digital gilts)
✔ On-chain money market funds (Franklin
Templeton, Fidelity)
✔ Tokenized private equity and real estate,
improving liquidity and access
✔ Carbon credits and commodities (e.g.
gold) as tokenized investment instruments
✔ Collateral management via platforms like
JPM’s TCN and SIX DCS
⚠️ Challenges to Adoption
- Fragmented
global regulations
- Cross-chain
interoperability limitations
- Legal
uncertainty in ownership enforcement
- Legacy
financial infrastructure incompatibilities
- Cybersecurity
and key management risks
📈 Tokenization is not
just a tech upgrade—it’s a reimagining of how value is created, exchanged,
and governed in global financial systems.
Source: World Economic Forum (WEF)
