Blockchain Industry Veteran Vadym Kurylovych Shares Views on a Tokenized World The whole world is moving towards tokenization wherein everyone is enthusiastic about its future possibilities. Very few understand it's actual application and implementation as of now. Blockchain industry veteran Vadym Kurylovych, CEO & Founder of cryptocurrency exchange STEX shares insights on the subject.
The year 2016 witnessed the ether DAO, which can be safely assumed as the first ICO, following by the hype of launch of the utility tokens and ICOs in 2017 and Quarter 1 of 2018 thereby dying a slow death to make way for asset tokenization and the launch of securities tokens.
This was akin to the gold rush with investors both retail and institutional alike lining up to grab a pie. It would be fair to say that today all venture capital firms directly or indirectly have interests tied to the crypto market.
Talking about the subject STEX Founder & CEO, Vadym Kurylovych said, On the surface, tokenization sounds easy. Issuing a blockchain based token wherein the tokens have legal rights and ownership rights. While diving deep into the subject one realizes what it requires; understanding of blockchain, DLT, smart contracts, legal, compliance, and finance.
Typically tokenization refers to the conversion of an asset class into a crypto token on the blockchain. Kurylovych believes that by 2028, 10% of the world’s GDP will be stored in crypto assets, amounting to $10 trillion. One of the key reasons is tokens provide liquidity. A typical token can be decimalized upto 18 decimals which reduces the entry barrier for new entrants. The holdings can be diversified in an easier manner as compared to other alternatives. The tokens having immutable ownership. It means blockchains by design are immutable and keep a public trace of every transfer and owner. A token cannot be held or transferred to more than 1 owner at a given point of time thus mitigating the chances of fraud.
Although tokenization comes with its own set of challenges and flaws. One common example is that questions the ownership of the asset tokenized. In case a company’s shares are tokenized, one must able to record the ownership on a token itself. This implies that to regulatory authorities, possessing the token is a representation of ownership right on the shares. Now since the tokens can be traded in secondary markets, with the transfer of tokens to any individual/entity the legal rights also get transferred owing to the assumption that tokens represent the company’s shares. But it is possible one can also legally sell the same shares to another outside of the token ecosystem.
Even with all the challenges present a tokenized world mean a fairer, more equitable world with a lower barrier to entry and capital requirements for individuals or businesses.
By converting the value in tokenized assets, we would be able to create a financial world with far less operational costs and complexities. Vadym also said, “We haven’t created a tokenized world yet, but it will be sooner than we know. Where not all assets would be tokenized but whatever can be, will be.”
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