Cryptocurrencies like bitcoin (BTC) and Ethereum (ETH) aren’t the only popular modern digital assets. Non-fungible tokens (NFTs), security tokens, and central bank digital currencies are common examples of popular digital assets.
To create a digital asset, a process called asset tokenization needs to take place. This is the process of converting a commodity into a digital asset on a blockchain network. Financial institutions, banks, and other organizations can break into the crypto market and appeal to tech-savvy investors.
Before you can enter this market, it’s important to choose the right tokenized asset platform. This guide will explain six asset tokenization platforms to consider for seamless digital asset management.
What Is an Asset Tokenization Platform?
An asset tokenization platform allows financial institutions, startups, and businesses to convert a valuable asset into a tokenized asset. Simply put, the tokenization process involves assigning a token for a traditional asset.
This token represents a stake of ownership in a tangible asset ranging from real estate to art. Tokens can even represent intangible assets such as company equity and intellectual property (IP).
These platforms embed digital assets on a public blockchain network. This ensures that the record of ownership is completely immutable and public. This means that when someone buys a token, their asset is secure if they keep the access key safe.
Benefits of Asset Tokenization Platforms for Businesses
If you’re ready to venture into the digital asset management ecosystem, here are some key advantages to choosing an asset tokenization platform.
Market Differentiation
By embracing asset tokenization, banks and financial institutions can differentiate themselves from competitors. This can help them showcase innovation and cater to the growing demand for digital asset investment.
According to a recent study, 40% of Americans own some type of cryptocurrency. Getting ahead of the curve and utilizing an asset tokenization platform can possibly lead to higher market growth opportunities.
Enhanced Liquidity for Illiquid Assets
Tokenization increases the liquidity of traditionally illiquid assets like real estate, collectibles, art, and private equity. With tokenization, investors can take advantage of fractional ownership and easier access to a broader investor base.
These advantages can potentially increase the asset’s market value. Real estate and art are two examples of illiquid assets that can be challenging to liquidate.
By converting ownership of these assets into tokens, investors can attract buyers interested in only purchasing a percentage of the asset. As more shares are bought, your illiquid asset can gradually change into liquid property.
Operational Efficiency
Using blockchain technology and smart contracts in tokenization streamlines important financial processes such as issuance, settlement, and clearing.
This technology can significantly reduce operational costs and improve transaction speed. Blockchain is an immutable and digitally distributed ledger — no outside source can interfere with it.
Financial institutions can use blockchain technology and smart contracts to ensure rapid-fire transactions on networks they don’t have to monitor.
Access to Global Markets
Asset tokenization platforms allow financial institutions to provide products to a global audience. This can help financial institutions overcome geographical limitations and tap into international investment opportunities and secondary markets.
Digital tokens aren’t tied to any fiat currency. Tokens can be bought from buyers in any country, allowing banking providers to build international audiences in crypto-friendly countries.
What To Look For in Asset Tokenization Platforms
If you’re ready to choose an asset tokenization platform, here are some vital qualities to consider.
Regulatory Compliance
Ensuring that an asset tokenization platform adheres to local and international crypto regulations is critical. Without maintaining legal compliance, your business could be put at risk for regulatory and public scrutiny.
Crypto platforms typically post their compliance documents in the legal section of their website. For example, Coinbase explains how they meet state and federal crypto regulations in their help center articles.
Robust Security Features
Asset tokenization platforms need stringent security measures to protect financial instruments against cyber threats and unauthorized access. Crypto platforms should automatically have Know Your Customer (KYC) protocols to follow Anti-Money Laundering (AML) compliance laws.
Two-factor authentication (2FA) can also help these platforms deny unauthorized access to malicious actors.
Platform Features
Not all digital asset management platforms are created equal. Nonetheless, quality asset tokenization platforms should offer these features:
- Positive user experience: Users should be able to navigate the platform easily without a steep learning curve.
- Asset diversity: The best asset tokenization platforms offer a wide range of assets that users can convert into tokens.
- Liquidity options: High-quality asset tokenization platforms should also provide seamless liquidity options for illiquid assets, such as real estate and art.
Technical Infrastructure
A quality asset tokenization platform should have a solid technical infrastructure to ensure scalability, reliability, and performance. Fortunately, many platforms should offer users the chance to request a free demo.
This allows financial institutions to test a platform’s technical infrastructure and make an informed decision without a financial commitment.
Comprehensive Support and Guidance After Launch
Once a tokenized asset is created, you’ll need ongoing support and guidance to ensure a smooth liquidation process. A platform that offers post-launch troubleshooting can help you fix problems before they affect the asset’s value.
The 6 Best Asset Tokenization Platforms and Services
If you’re ready to decide, here are the best tokenization platforms available for banks, asset managers, and financial institutions.
1. AlphaPoint
AlphaPoint offers a complete suite of white-label digital asset management solutions for banks, financial institutions, businesses, and government agencies. Users can leverage AlphaPoint’s technology to create a crypto exchange, accept crypto payments, and tokenize tangible assets to help create a cashless society.
With AlphaPoint, customers can create security tokens, cryptocurrencies, and other digital assets from:
- Real estate
- Luxury goods
- Private company shares
With robust smart contract technology, AlphaPoint ensures the rapid deployment of tokens for any venture. In fact, our services have been battle-tested across more than 35 countries for over a decade.
2. Securitize
Securitize is an investment platform that helps institutional investors access private markets by tokenizing real-world assets (RWA). Their business offering is for asset managers, venture capitalists (VCs), and financial institutions.
These entities can use Securitize’s platform to tokenize shares and manage shareholders all from one central location. Their platform also automates investor onboarding and regulatory compliance.
3. Polymath
Polymath is a capital platform that allows users to digitize RWAs, as well as:
- Mint and distribute tokens
- Manage investors and shareholders
- Raise capital for illiquid assets
Polymath combines all the aspects of digital asset management, from creating an offer to token issuance to attracting investors. Polymath appeals to all kinds of audiences, including asset owners, advisory teams, and investors.
4. Bitbond
Based in Berlin, Germany, Bitbond is an asset tokenization and digital asset technology provider. With Bitbond, customers can leave complicated transaction settlements behind in favor of instant tokenization services.
Through the Token Tool, financial institutions can create and manage tokens, as well as automate payments and portfolio tracking. Bitbond is non-custodial, meaning customers own the keys to the smart contracts they deploy and can use virtually any Web3 wallet for token creation.
Bitbond makes creating, managing, and tracking ERC20, ERC1400, and ERC721 tokens simple.
5. TOKO Network
TOKO is a digital asset creation platform. According to their official website, “TOKO empowers value creation by covering the spectrum of the token lifecycle, giving asset owners the power to tokenise assets that are traditionally illiquid and making them investable.”
TOKO provides tokenization services and expertise to asset managers in the following areas:
- Origination: TOKO helps customers tokenize tangible or intangible assets and make them investable.
- Distribution: By fractionalizing RWAs, issuers can promote their digital securities to a wide range of investors.
- Discovery: TOKO empowers issuers to submit a captivating product offering and find interested buyers on their secondary exchange network.
- Trading: Through tokenization, TOKO users can bring liquidity to illiquid assets.
6. Vertalo
Vertalo is a private asset management platform that offers tokenization services. Vertalo customers can receive access to the security token ecosystem and raise funds for all asset classes.
Vertalo’s API works seamlessly with any ERC20-wallet, allowing customers to tokenize assets with the click of a button instantly. What’s more, Vertalo offers keyless custody for tokenized assets.
This means customers don’t need advanced private-key knowledge to hold their assets. Ultimately, Vertalo is geared toward private companies that need to tokenize equity and raise funds from a secure and compliant platform.
Tokenize Your Assets and Enjoy Full-Scale Support With AlphaPoint
Tokenizing RWAs greatly maximizes their exposure and value amongst modern investors and asset managers. With the help of smart contracts, tokenization is simple.
Most of the time, asset tokenization can happen in a few minutes. Nonetheless, having access to a brilliant asset tokenization platform that offers post-launch support is key. AlphaPoint provides both of these services.
With AlphaPoint, you can easily tokenize a wide range of assets. On top of that, our team will provide support and guidance after the launch of your token to ensure smooth delivery to investors.
To try AlphaPoint for yourself, request a demo today.
