Enterprise tokenization is growing and looking to gain significant traction over the next few years – According to the Boston Consulting Group (BCG), the tokenization market could reach $16 trillion by 2030. Indeed, the tokenization of securities using blockchain technology offers significant benefits to the financial markets, such as increased liquidity, faster settlement times, and cost savings. According to PwC, tokenization allows for the digital representation of asset ownership, enabling quicker and more cost-effective transfers or trades of assets like stocks, bonds, and even loyalty points. This process can also enhance operational agility, improve capital efficiency, and unlock new market segments.
Tokeny is a platform that allows enterprises to issue, manage, and distribute securities on blockchain while ensuring compliance. In a few numbers, Tokeny is:
- $28 billion in total value tokenized since 2017
- 120+ Satisfied Customers
- 3 Billion Blockchain Events Indexed
What does Tokeny offer?
Through their ‘T-REX Platform’, Tokeny allows you to issue tokenized securities very easily through no-code solutions or API. Thanks to a built-in platform, they make it straightforward to allocate security tokens to eligible investors in a compliant and scalable way.
They put a strong emphasis on personalisation, where additional features allow you to perform actions on the securities, such as recovery processes or scheduling the delivery of transaction and position reports.
Investors also have access to a digital interface where they can easily communicate with issuers, access reporting and overall manage their digital securities.
Tokeny also provides a white-label digital asset marketplace that makes it very quick and easy to launch your own marketplace where you can easily list project offerings and onboard investors, enable peer-to-peer trading on the secondary market and allow your investors to manage their portfolio.
How does the tokenization work?
Let’s now dive a bit more into the technical details of how this tokenization process works.
Tokeny has created the ERC-3643 standard, a technical standard on the Ethereum blockchain used to tokenize securities. The firm has also created DINO, an interoperable distribution network for digital securities, leveraging the ERC-3643 standard. This network helps enhance the distribution of the private issuances that were tokenized.
Any ERC-3643-compatible tokens can easily connect to liquidity pools in the DINO network. The network includes digital trading desks (OTC, Billboards, etc.), regulated trading venues (exchanges, ATS, MTF, etc.), decentralized exchanges, and DeFi protocols. You can view DINO as a global network of distributors and investors where tokenized securities are directly distributed to investors and secondary market benefits from enhanced liquidity thanks to the interoperability offered by blockchain. Tokenization brings great benefits, but it does not magically bring investors. DINO brings you the audience. Assets tokenized with the ERC3643 standard are immediately interoperable with all the service providers of the ecosystem, including dozens of liquidity providers, opening access to investors.
Overall, any ERC3643-compatible tokens can easily connect to liquidity pools in the DINO network, which is key to fostering distribution of tokenized assets, making private markets more liquid and interoperable. DINO currently supports more than 50 tokens, cumulating more than $28B of AUM across more than 100 partners.
How is blockchain technology key in tokenization?
Traditional financial systems are opaque and not interoperable as they simply do not possess the technology to do so. A lot of processes in banks are still not automated and digitized. The whole system is lagging behind in terms of technology. For investors, this means longer processes, more complexity and higher fees due to intermediaries and inefficiencies. Blockchain fundamentally enhances the efficiency and accessibility of financial markets.
Tokenization, which involves converting asset ownership into digital tokens on a blockchain, ensures faster and more cost-effective transactions. According to PwC, this process allows for quick and secure transfers of assets, significantly improving operational agility and reducing costs. Additionally, blockchain’s transparency and security features provide greater visibility and trust, reducing counterparty risks and enabling precise settlement timing. Blockchain also enhances liquidity by enabling fractional ownership, allowing traditionally illiquid assets, like real estate or private equity, to be divided into smaller, tradable units, thereby widening the investor pool and unlocking new revenue opportunities