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Tokenisation –
from material to digital
Tokenisation is the term used to describe the creation of a digital replication of a tangible asset (e.g. machinery, equipment) or an intangible asset (e.g. software programmes, licen- ces). In other words, the specific asset is securitised with the help of blockchain techno- logy and represented as a digital asset by a token.
Key benefits of tokenisation
Status October 2020
1. Tokenisation offers a number of crucial advantages over conventional securitisation
approaches that involve financial intermediaries. The involvement of these parties can be reduced thanks to digital securitisation and redirection, which in turn leads to a signifi- cant increase in efficiency in the trading of digital assets. Trading hours are also greatly extended, as trading via blockchain can essentially be undertaken 24/7. Moreover, the costs of such transactions are substantially reduced.
2. As digital tokens can be designed in very small denominations, investors can now gain exposure to exclusive asset classes with levels of capital that would previously have been far too low. For example, it is now possible to purchase 0.01 percent of an expen- sive painting via blockchain.
Tokenisation on the cusp of a breakthrough?
Since the new Blockchain Act entered into force on 1 February 2021, it has also been possible for Swiss companies to handle their share register or capital increases on a fully digital basis thanks to tokenisation. This is also likely to stimulate alternative corporate financing.
The issuing of securities – especially equities – as tokens is carried out by the companies themselves and via their own distribution and settlement platform. This makes it much easier to directly address investors (private investors, institutions, partners, suppliers) in the sense of crowdfunding.
In addition to fiat money, cryptocurrencies can also be accepted. This possibility is likely to be used, in particular, by companies that also wish to attract international, innovative clients through the issuing of tokens.
Reto Gadient CEO of B.ACADEMY GmbH, strategic consulting on blockchain, co-founder of the Crypto Valley Association, large international network for connecting companies and investors, organiser of private investor circles and Crypto Mountain Rocks
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