Blockchain technology makes it possible to digitalize ownership structures, rights and tangible assets of various kinds.
Many industries are beginning to recognize the great potential of blockchain technology and are trying to implement their own applications. The financial world in particular will have to deal with this technological development. It was once the introduction of the stock corporation in the 17th century that was so revolutionary and ultimately changed the entire financial world. With the potential of blockchain technology, many experts see a new milestone in the development of the financial world and financial markets. The World Economic Forum (WEF) has published numerous analyses and studies and assumes that by 2029 a value of approximately 10 trillion US dollars will be tokenized with the help of the blockchain.
In Germany, the federal government has published its blockchain strategy and announced the token economy. On November 14, 2019, the German Bundestag decided with a change in the law that cryptosystems will become an official financial instrument in Germany with appropriate regulation. With this political movement, the fourth EU amendment directive on money laundering was transposed into German law. In addition, the government recently amended the German Money Laundering Act and Banking Act (KWG).
Basically, the term tokenization describes a fragmentation or division. A single part or piece is called a token. In relation to a financial instrument, tokenisation is a digital securitisation process of ownership of certain assets, goods, physical objects or rights. Through securitisation, ownerships can be represented by a digital token.
For example, if the value of a property is tokenised, this can mean that several people can acquire digital shares of a property. Each of these people will share the value of the property by owning the token.
The advantages in terms of efficiency of cost and transferability are enormous. There is no need to go to a notary and no land transfer tax is triggered when the token are transferred. Token are in no way inferior in functionality to digital securities. The advantages move the industry and will have an impact on existing stock exchanges and financial markets. Everything that is tradable as a digital security today could be tokenized and issued tomorrow using blockchain technology to save costs and time whilst increasing efficiency. It is also possible that existing financial instruments could be expanded to include new assets in the future.
The blockchain is a technology with which a database can be created and operated over a network of different participants. If the participants are at different locations, we speak of a decentralized system. The data is stored continuously and is linked to the previous data record. A subsequent change is almost excluded and manipulation is not possible.
A token is a piece of a whole. In terms of blockchain technology, a token certifies ownership of certain values, goods or rights.
Tokenization is the division of an entire unit into individual components. With reference to blockchain technology, a defined value is mapped digitally into individual values known as token.
In a highly regulated market environment, we have identified various conflict potentials and developed a solution in coordination with the legislator. Both our products and our technological implementation comply with the regulatory framework.
We develop our solution using the latest technologies, frameworks and standardized components. During development we use the most modern software practices. By maintaining standards, we achieve a high degree of automation and are therefore ready for the next stage of development.
By integrating our own blockchain infrastructure, we can tokenize or process transactions even more cost-effectively. We are independent of the utilization and cost structure of a public blockchain.
The blockchain infrastructure ensures that tokens can be transferred in accordance with current security standards. Digital shares are issued via our marketplace and can also be traded by market participants.
Almost every asset can be tokenised. It is certainly more a question of 'how' - it is important to comply with the applicable legal framework and to reach agreement with the legislator on the structuring of the security.
Our properties are tokenised via a so-called SPV (Special-Purpose-Vehicle). The SPV was founded with the purpose of holding real estate. The tokenised digital shares of the property (special purpose vehicle) can be issued and traded from now on.
The tokenisation of our art goods is also implemented with the help of an SPV (Special-Purpose-Vehicle). Unlike real estate, there is no property register for works of art. Nevertheless, we use the structuring possibilities offered by a special purpose vehicle and issue digital shares based on the art goods.
We are able to tokenize almost any tangible asset. Through blockchain technology and tokenisation, we have the possibility to represent this asset digitally with a number of token. In order to achieve this, we rely on standards in development. We use the Ethereum blockchain as the foundation technology. The Ethereum Blockchain is widely used and has a strong community. The technology can already be found in some applications and the crypto token ETH is based on this blockchain. For the development of the tokenisation we rely on the ERC-20 standard. The token is developed with the framework Openzeppelin. This framework provides common contract templates that have been tested by Openzeppelin. We intentionally rely on standards for the development of tokens (Smart Contracts). This approach gives us the option of integrating third-party token on our platform or our token on third-party platforms.
Are you interested in the tokenisation of your tangible assets? We offer our platform to interested parties as a Software-as-a-Service (SaaS). You can use our infrastructure for your purposes. If you need support in structuring your assets, we will be happy to help you with our know-how. You can find further information about our SaaS model here: