The Brazilian exchange Mercado Bitcoin recently announced that it will sell fractions of rights of football players in the form of encrypted tokens, a process known as tokenization. And the market has other token sales projects that represent physical assets (security tokens), be they collectible cars, artwork, real estate and others. Tokenization is therefore a real alternative for the investor seeking to invest in the crypto market, backed by assets of the physical world.
Tokenization is the process of converting some asset (shares, real estate, etc.) into hundreds or thousands of encrypted tokens, which can be moved, recorded or stored in a blockchain system. These tokens represent a fraction of the value of that asset in the market. As the assets are valued, tokens track that valuation. Besides, if the asset is sold at a profit, the equivalent ratio in tokens is destroyed and this burn causes the individual value of a token to increase.
Take a look at some of the tokenization projects in the market and how they deliver returns to the investor:
Real estate tokens located around the world
Real estate is historically seen as store of value instrument. Dynasty, founded by the Brazilian Eduardo Carvalho, launched a regulated payment token, of worldwide acceptance, backed by real estate spread over almost all continents, the main ones being South America, North America, Europe and Asia. The company recently closed its private offer to qualified investors in Brazil and will make a road show across Europe with the same goal. Initially, the company issued 1 million tokens with a unit value of 50 Swiss francs.
Investing in luxury cars is possible
The CurioInvest platform allows you to own a slice of a luxury car and be part of a select investor club that buys and sells collectible cars as an investment asset. The purchase of pieces of these cars occurs through the acquisition of security tokens, whose price varies according to the “quotation” of these cars in the market. The resources are used to actually buy the car for future resale. Token holders earn the right to receive the profits from the resale of the vehicle. The investor can diversify their investments by buying tokens from different luxury cars.
Works of art: good for the authors and buyers
Works of art are considered one of the safest investments on the market. One of the most representative tokens in the art market is The Art Token (TAT). Each TAT token is backed by renowned post-war and contemporary works of art. This art genre has the most stable performance in the last 50 years and offers great potential for return. Artworks are physically stored in a government-protected warehouse. And all works of art are 100% insured through international insurance companies. The buyer, in his turn, has no cost with this storage and insurance.
Gold tokenization is also a reality
The gold is also historically seen as humanity’s main store of value. Digix has an encrypted token backed by physical gold. With it, investors can apply in what is one of the assets in which people most reach for in times of systemic crisis. Physical gold bars can be verified by the public through blockchain. The safes are located in Singapore and Canada and are fully insured.
To purchase these tokens backed by assets from the physical world, the process typically includes searching on which exchange the token is listed, registering, and exchanging bitcoin or other cryptoassets, such as a stablecoin, for it. It is usually also possible to do this process by downloading a wallet developed by the issuer. It is worth remembering that the risks of these investments are the same in the real world and that past returns do not guarantee future appreciation.