Tokenization at its core converts traditional assets into digital tokens that can be traded on the blockchain. Whether it’s real estate, debt, bond, or stock in a company, tokenization brings efficiency and transparency to these processes. It also expands retail investors’ access to these asset classes. A new research report by Brickken and Cointelegraph Research examines the underlying business models and provides a detailed analysis of why many TRADFI companies are jumping on tokenization trends.
Anatomy of tokenized asset issuance
The journey begins with a transaction structure. Assets such as assets, assets, bonds, or private equity funds are identified and legally organized here. In many cases, this asset is held by so-called special purpose vehicles (SPVs), which are dedicated corporations designed to protect the rights of investors.
Once the foundation is laid, the assets enter the digitization phase and record on-chain. Once created, smart contracts can automate processes such as compliance checks, dividend payments, and shareholder voting. This automation reduces management costs, eliminates inefficiency, and makes your systems faster and more reliable.
During primary distribution, tokens are issued to investors in exchange for capital. This is similar to the digital version of the Initial Public Offering (IPO). Investors will know about customer checks, receive tokens representing fractional ownership, and have instant access to secure, transparent blockchain-based investment records.
After the initial issuance, the token is managed through post-tokenization activities. The distribution of dividends, shareholder votes, and ownership changes is all automated via smart contracts. Secondary trading platforms can provide additional liquidity lamps to investors looking to cash out. Instead of waiting months or years to sell traditional assets, tokenized assets can be traded by clicking a button.
Tokenization revolutionizes asset classes
Tokenization is not limited to a single type of asset. From real estate to debt certificates and even carbon credits, its potential applications are almost limitless.
Debt tokenization is a game changer in the traditional capital market. By representing bonds or loans as digital tokens, issuers simplify transactions and provide the liquidity needed for these traditional static assets. A notable example is the European Investment Bank, which issued 100 million euros of digital bonds to the Ethereum blockchain. This is a clear indication of how tokenization modernizes financial products.
The world of fund management is also beginning to see changes in earthquakes. Tokenized funds such as the Franklin Templeton On-Chain US Government Money Fund use blockchain technology to process transactions and manage share ownership. According to the Security Token Market, more than $50 billion in assets across all asset classes have been tokenized by the end of 2024, with $30 billion being born from real estate. As more institutions adopt blockchain technology, these numbers are expected to skyrocket in 2025.
Tokenization is no longer a theoretical concept, it is an unprofitable sector or a niche market. It has been tested, tweaked and poised to rebuild the financial environment. With streamlined processes, increased liquidity and wider access, the technology is unlocking opportunities that were once out of reach.
As 2025 continues, we can expect further adoption across the asset class, deeper integration with the Defi platform, and innovation in the tokenized market. Tokenization looks promising for both traditional and institutional investors.
This article does not include investment advice or recommendations. All investment and trading movements include risk and readers must do their own research when making decisions.
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