Before you start tokenizing your assets, you need to decide on the type of asset you will be using. Try to choose an asset that has a big market. This way, you’ll know how much to charge for your tokens and how much you will earn. You can then request an asset valuation from a third-party accounting firm. Before you begin, you need to plan how you will make a living. Think about your sources of revenue, your financing details, and your future client base.

Benefits

Asset-backed tokens are virtual securities that represent a fraction of the value of an asset. Tokens are used in the financial industry to enable fast and efficient transfers in and out of investments. They have several advantages. For example, tokens can represent a right to earn on the value of an asset, or they could represent voting rights in equity. With these benefits, asset backed tokens have a high potential for fostering the growth of new industries.

The technology behind asset-backed tokens is a smart way to structure deals. They combine the process of distribution and syndication into one instrument. Tokens also allow developers to access a broader audience, including those who might not have access to other investment options. As a result, asset backed tokens are democratizing finance. For example, governments are tying the value of crude oil to official digital tokens, and the real estate market is moving toward tokenized fractional ownership.

Use cases

One of the most obvious use cases for asset backed tokens is in the real estate market. Tokenized pieces of real estate allow buyers to acquire a fraction of the entire property. For example, St. Regis Aspen Resort recently raised $18 million in tokenized liquid funding. This liquid cash can then be used for real estate improvements, expansions, or investments. Moreover, businesses can also use asset-backed tokens to finance a range of operations.

Tokenization of intangible assets such as intellectual property is another use case. Many of these assets exist in digital form and have no physical presence. Asset backed tokens provide more transferable ownership for these assets, which makes them more appealing to investors. Additionally, asset-backed tokens can be used to create an augmented or virtual reality ecosystem in which RPG characters or objects can be traded. Users can also trade assets without worrying about stealing them by offering a definable digital asset, such as an IP portfolio.