{"id":269211,"date":"2024-06-27T09:16:30","date_gmt":"2024-06-27T09:16:30","guid":{"rendered":"https:\/\/www.techopedia.com\/?post_type=definition&p=269211"},"modified":"2024-06-27T09:16:30","modified_gmt":"2024-06-27T09:16:30","slug":"real-world-asset-rwa-tokenization","status":"publish","type":"definition","link":"https:\/\/www.techopedia.com\/definition\/real-world-asset-rwa-tokenization","title":{"rendered":"Real-World Asset (RWA) Tokenization"},"content":{"rendered":"
The definition of tokenized real-world assets (RWAs) is the digital representation of physical assets using blockchain technology<\/a>. Asset tokenization<\/a> involves creating a digital token that is tied to a tangible asset, such as real estate, commodities<\/a>, or art. These tokens can be bought, sold, and traded on blockchain<\/a> platforms, providing a seamless way to transfer ownership and maintain records.<\/p>\n The concept of RWA tokenization<\/a> aims to bring liquidity<\/a>, transparency, and accessibility to markets that are traditionally illiquid and complex.<\/p>\n <\/p>\n Tokenization is the process of converting ownership or rights to an asset into a digital<\/a> token on a blockchain. It can apply to a variety of tangible and intangible assets, including digital art and designer watches.<\/p>\n For physical assets, tokenization means creating a digital representation of ownership that can be managed on a blockchain. For digital assets<\/a>, it might involve encapsulating existing digital rights or information. Tokens are designed according to standards<\/a> (e.g., ERC-20<\/a>, ERC-721<\/a>) to ensure they can be easily traded and managed on various blockchain platforms, such as Ethereum<\/a>, Binance<\/a>, and Solana<\/a>.<\/p>\n Self-executing smart contracts<\/a> with the terms of the agreement directly written into code automate the execution of transactions and ensure compliance with predefined rules. Smart contracts manage token issuance, transfer of ownership, distribution of dividends<\/a>, and other operational processes.<\/p>\n <\/p>\n Here are the key steps in the process of tokenizing RWAs:Key Takeaways<\/span><\/h2>\n
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How Tokenization Works<\/span><\/h2>\n
How to Tokenize Real-World Assets<\/h3>\n
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