The tokenization of assets, when it emerged, was always an offering model associated with real goods, largely due to the notoriety of NFTs. However, over time, financial assets have occupied an increasingly larger space in the tokenized economy.
This is mainly due to the ease with which it is possible to generate a token for a security or financial market product and obtain better results, both for those who offer the assets and for those who invest capital in tokens.
Financial assets are equity resources whose values derive from contracts signed between investors and financial institutions in the traditional investment market.
It is within this relationship that unfortunately there are some barriers for many Brazilians to invest or seek better returns. High entry values in some applications and difficulties in reconciling routine with investment decisions are some of them.
Can tokenization change this reality for offerors?
How can a small investor invest in great investments using tokens?
BLOCKBR, a company that develops tokenization infrastructure, shows which financial assets can be tokenized and how this technology will transform the investment market!
WHAT ARE THE POINTS OF ATTENTION FOR INVESTING IN FINANCIAL ASSETS
Here are some conditions that we must know to make the best investment choices in financial assets.
WHAT IS YOUR INVESTMENT PROFILE
Investing in financial assets implies, first of all, analyzing whether all the attributes – we will see below – of a product are aligned with the investor’s profile, as this is a critical factor in the success of choices.
- Bold investor: prioritizes greater gains even with greater risk;
- Conservative investor: their focus is to guarantee a stable income with low risk;
- Moderate investor: moves between the other two profiles, mixing opportunities and dealing with different expectations of gain and risk.
WHAT IS THE LIQUIDITY OF THE ASSET
Liquidity is the speed with which we transform the investment position into capital after requesting redemption. This indicator is essential to align the redemption period with the possibility of using the capital in a market opportunity.
This is usually an important difference between financial assets and real assets, such as real estate, which take longer to be negotiated and raise funds.
WHAT IS THE VOLATILITY OF THE ASSET
The volatility of a financial asset indicates its level of exposure to different factors that are present in the economy – inherent ones such as speculative bubbles and unforeseen events such as economic, cyclical or market crises in particular.
This indicator varies greatly between financial products. Cryptocurrencies are a great example of a highly volatile monetary asset that can lead to unthinkable losses and surprising gains within weeks.
WHAT ARE FINANCIAL ASSETS
The universe of financial assets is quite broad and is constantly changing. See examples of the most well-known financial products.
- Cash (yes, it is a financial asset, but it does not yield);
- Company shares;
- Government bonds (Tesouro Direto);
- Private fixed income and variable income securities;
Each type of financial asset has particularities in terms of return potential, risk, liquidity and volatility that must be studied carefully before investing.
THE TOKENIZATION OF FINANCIAL ASSETS
Tokenizing financial assets means trading securities through digital representations of them on a digital platform hosted on a blockchain. In practice, you offer or purchase an asset token and become the owner of the rights it represents.
Likewise, the appreciation of the token is, in fact, the market performance of the asset linked to it. For this reason, it is essential to research the characteristics of the product – for example, what are the income prospects of a precatório token.
But why can financial tokens represent an advantage when investing?
WHY TOKENIZE FINANCIAL ASSETS
A GLOBAL AND UNINTERRUPTED OFFER
Tokenizing financial assets means making them available to investors from all over the world and is not a force of expression: it is possible to invest in digital assets anywhere on the planet.
All the person needs to do is use a smartphone or computer.
Furthermore, the token platform operates 24/7 and this includes holidays. These two characteristics – universality and availability of tokens – guarantee greater liquidity for the financial asset with tokens.
MORE LIQUID SECONDARY MARKETS
There are many tokenized assets that can be traded on the secondary market, the layer of the blockchain where investors in financial tokens renegotiate tokenized securities.
Without the interference of intermediaries, negotiations are agile and increase the attractiveness of the asset, as it becomes evident to an even larger universe of investors.
ACCESS TO A BIGGER AUDIENCE OF INVESTORS
An important differentiator of tokenization is fractionation; It is possible to divide a security into several tokens of small value, possibly reaching thousands of them. This makes the tokenized financial asset accessible to small investors.
This democratization naturally accelerates liquidity, not to mention that by fractionalizing the security, it is possible to price it better without affecting the attractiveness of tokenization.
MORE OPERATIONAL EFFICIENCY AND SAFETY
The blockchain combined with the smart contract forms a token supply management solution of the highest level in terms of efficiency, transparency and security.
- Blockchain is a distributed database – shared among countless computers, without a central power where data could be stolen or tampered with in a virtual attack;
- There is also no possibility of duplication of use of tokens as each transaction is registered with a unique identification and inserted into a chain of data blocks;
- No transaction is made without the unanimous approval of the points (computers);
- With each approved transaction, all points have the same updated database;
- All tokenization operations, from the distribution of tokens to the periodic remuneration of investors, are managed electronically by the smart contract;
This way, it becomes impossible for a computer to be able to defraud an operation with tokens.
WHY APPLY IN FINANCIAL ASSETS TOKENS
INVEST IN INACCESSIBLE FINANCIAL ASSETS
The fractionation of a financial security into tokens not only favors those who offer the asset, but also allows more people to have access to products that are restricted within the traditional investment market – the traditional barrier to entry.
Small investors can invest their capital in tokens related to products that under normal conditions would only be accessible to qualified groups, companies or investors and which are naturally the most attractive.
This way, the person can get out of savings and have real income.
TOTAL AVAILABILITY
The blockchain never closes.
There is no exaggeration in the statement; If you want to buy a token from a consortium share in the early hours of the morning, you will find the tokenization platform open and the steps are 100% electronic, so you do not depend on a bank manager or broker.
DIVERSITY OF INVESTMENTS
This is a good consequence of the democratization of access and the popularization of tokenization: you will find more diversity of products over time and for the most varied investment budgets.
It is possible to start investing in tokens with 50 reais!
BLOCKBR Digital Assets is a fintech specialized in tokenization of assets and investments that delivers infrastructure to the regulated and non-regulated market through an All-In-One platform that offers the transformation and interoperability between assets and investors.
For more information, visit: http://www.blockbr.com.br or @blockbr_ on social networks
