Don't Rush To Convert All Assets Into Tokens

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Bittime - Many people in the world of finance today are obsessed with tokenization, where assets are converted into digital tokens. However, these trends do not always produce real value for investors. This article discusses why excessive tokenization can be dangerous and how blockchain technology can be better utilized to create innovative financial solutions.

What is Tokenization?

Tokenization is the process of converting assets into digital tokens. These tokens can represent a wide variety of assets, such as shares, real estate, or even works of art. 

Tokenization allows assets to be traded more easily and efficiently in digital markets. This can also help increase transparency and security of asset ownership.

Read Also What is Real Estate Tokenization in Cryptocurrency?

Tokenization Issues

• Unnecessary Complexity: Tokenization often adds unnecessary layers and costs to financial products, such as the example of a tokenized Bitcoin ETF that does not provide meaningful returns.
• Wrong Focus: Instead of focusing on tokenizing existing assets, DeFi (Decentralized Finance) should leverage the main strengths of blockchain namely programmability and transparency.

Blockchain Potential

• Smart Contracts: Automating financial transactions through smart contracts can increase efficiency, lower costs, and increase transparency compared to traditional systems.
• On-chain Management: Bringing financial processes directly to the blockchain enables real-time tracking of funds, thereby reducing the risk of misuse.

The Path to the Future of Tokenization

• Value-Focused Projects: Supports DeFi projects that leverage blockchain to create new, secure, and efficient financial solutions.
• Transparency and Security: Optimize blockchain transparency to increase investor confidence and reduce the risk of fraud.

Also Read : What is RWA and Why is it Important for DeFi?

The Future of DeFi

The future of DeFi lies in integrating new asset classes natively on-chain, such as:

• Native On-chain Assets: Move digital assets such as equities and treasuries directly to the blockchain (public or private).
• Enhanced Efficiency and Security: This shift offers efficiency, security, and the potential to disrupt the current dominance of financial institutions.

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Conclusion

Instead of getting caught up in the tokenization trend, DeFi should focus on innovatively leveraging blockchain technology to create financial solutions that benefit all.

How to Buy Crypto from Bittime

You can buy and sell crypto assets in an easy and safe way via Bittime . Bittime is one of the best crypto applications in Indonesia which is officially registered with Bappebti. 

To be able to buy crypto assets on Bittime , make sure you have registered and completed identity verification. Apart from that, also make sure that you have sufficient balance by depositing some funds into your wallet. For your information, the minimum purchase of assets on Bittime is IDR 10,000. After that, you can purchase crypto assets in the application. Learn Complete Guide How to Buy Crypto on Bittime . 

Monitor price chart movements of Bitcoin (BTC) , Ethereum (ETH) , Solana (SOL) and other cryptos to find out today's crypto market trends in real-time on Bittime.

Read Also:

What is Governance Token? Decentralized Project Driving Token

Apa Itu Dual-Token Economy/Model (Two-Token Economy)?

Volcan Forged, a Blockchain Game that Brings Innovation in Cryptocurrency

DeFi Stack: Stablecoins, Trading Platforms, Synthetic Assets, Lending Markets, and Insurance

DISCLAIMER: This article is informational in nature and is not an offer or invitation to sell or buy any crypto assets. Trading crypto assets is a high-risk activity. Crypto asset prices are volatile, where prices can change significantly from time to time and Bittime is not responsible for changes in fluctuations in crypto asset exchange rates.