Tokenization of real assets

[m1m2]

Hello IoTeX community,

I hope this message finds you well. I wanted to share some thoughts and suggestions regarding the exciting topic of tokenization of real assets using IoTeX. As one of the early adopters of IoTeX, I believe that this technology holds immense potential, and I’m thrilled to be a part of this community.

Here is a summary of the key points from the recent forum conversation on tokenizing real assets using IoTeX:

1. Tokenization Opportunities

Tokenization provides new opportunities for managing real-world assets like real estate, art, and commodities on the blockchain through NFTs. This can enhance liquidity, accessibility, transparency, and security.

2. Technical Challenges

There are technical challenges, such as effectively marking physical assets and ensuring authenticity. IoTeX’s technology could help address this through connecting physical devices to the blockchain.

3. Legal and Regulatory Uncertainty

Legal and regulatory uncertainty remains in many jurisdictions regarding asset tokenization. Compliance and investor protections need to be considered.

4. Security Concerns

Security vulnerabilities are a concern, including wallet hacks. Caution should be exercised by users to safeguard assets. Ongoing improvements in cryptography, protocols, and wallets can enhance protections.

5. Intellectual Property Rights

Intellectual property rights like copyrights could also be tokenize, allowing creators more control and monetization opportunities.

6. New Platforms

New platforms are emerging for trading tokenized assets, like nft.mimo.exchange on IoTeX. This could open up fractional ownership and lending opportunities using NFTs as collateral.

7. Requirements for Real-World Adoption

For real-world adoption, authenticity, security, compliance, and usability need to be robust throughout the tokenization process. Teams involved should have relevant expertise across legal, technical, and asset management domains.

8. An Offering of Participation

On behalf of myself, I am ready to offer the IoTeX team (@raullen, @qevan, @larrypang, @zimne, @Artanovskaya) my participation in the creation of the “Tokenization of real assets” direction in the role of an IoTeX staff member or consultant. I have extensive experience in working with real assets. I hold a Master’s degree in Information Technology and Systems Analysis, and I am very familiar with the IoTeX project and its technologies.

To maximize IoTeX role in the tokenization of real assets, I would like to suggest the following:

1. Collaborating with Legal Experts

Collaborate with legal experts to develop compliant tokenization frameworks adapted for different asset types and jurisdictions. This will ensure that IoTeX remains compliant with evolving regulations.

2. Educating Users

Educate users on security best practices for protecting crypto wallets and assets. A well-informed community is essential for the safe adoption of tokenization.

3. Showcasing Real-World Use Cases

Showcase proven tokenization implementations across diverse assets to demonstrate real-world utility. This will build confidence in IoTeX’s capabilities.

4. Exploring Cross-Chain Interoperability

Explore cross-chain interoperability so IoTeX tokenized assets can operate across multiple networks. This will increase the reach and accessibility of IoTeX-based tokenized assets.

5. Fostering an Ecosystem

Foster an ecosystem of qualified partners covering tokenization, legal compliance, asset custodianship, insurance, exchanges, and more. A strong ecosystem will support the growth and adoption of IoTeX.

With diligent efforts across these areas, IoTeX can become a preferred blockchain for compliant and reliable tokenization of real-world assets. This can expand the IoTeX network’s capabilities and value in connecting the physical world with decentralized finance.

I look forward to seeing how our community and the IoTeX team continue to innovate and lead in this exciting field of asset tokenization.

[m1m2]

Hi, I read a great article yesterday “Guest Post: On Decentralized Physical Infrastructure Networks (DePIN)” and I want to expand on it with my thoughts and give a real detailed example of using DePIN technology in tokenizing fine art objects to connect real and virtual art galleries. I have experience with a lot of real assets, so the topic of tokenization is interesting to me as both an academic study and as a business practitioner.

The Physical Artwork:

• Each artwork (painting, sculpture, etc.) would be assigned a unique NFT representing ownership and provenance on the blockchain. The NFT would be linked to a tamper-proof RFID chip physically embedded in the artwork.

The Art Gallery DU:

• Galleries would deploy small standardized devices (DePIN Units or DUs) to enable the following:
• RFID readers to detect nearby artworks and authenticate via the NFT on blockchain
• High resolution cameras to digitize and display artworks in a virtual gallery
• Environmental sensors (temp, humidity, motion, etc.) to monitor artwork condition

Incentives & Token Model:

• Galleries earn tokens for displaying/hosting artworks and providing condition data via the DUs.
• Curators earn tokens for digitizing and adding metadata for artworks.
• Patrons earn tokens for viewing art in the virtual gallery.
• Tokens are used to pay galleries to display artworks and used by patrons to purchase art.

Consensus Protocol:

• Leverage blockchain, NFTs, and tamper-proof RFID chips for trusted verification of artwork provenance, location, digitization, and condition data.

Virtual Gallery Experience:

• Anyone can view digitized art in virtual gallery via web or VR, seeing current gallery locations and condition.
• Patrons use tokens to purchase and request delivery of artworks to their preferred galleries.
• Art is transported between galleries based on patron demand, incentivizing galleries to properly care for and display works.

In this model, DePIN allows digitization and tokenization of real fine art while incentivizing a network of real world galleries to host and care for physical works. Virtual and real world art markets are connected while artwork provenance is verifiable on the blockchain.

A few ways investors could potentially earn money by investing in fine artworks tokenized using a DePIN model:

• Appreciation in artwork value - As with traditional art investment, the intrinsic and market value of the artwork may appreciate over time. The artwork’s provenance and exhibition history recorded on blockchain via DePIN can help demonstrate its increasing value.
• Earning staking/hosting rewards - Galleries and museums can earn tokens as a reward for securely hosting and displaying artworks in their facilities. More prestigious institutions could earn higher rewards for boosting an artwork’s reputation.
• Sharing in royalty fees - A % of the token fees paid by patrons to view digitized artworks or to purchase/relocate art could be distributed to artwork owners/investors as royalties.
• Curator rewards for digitization - Experts could earn rewards for digitizing and adding metadata to artworks, with higher rewards for works they help authenticate and promote. A % could go to investors.
• Platform fees and services - The DePIN platform itself may charge small fees for artwork transactions and activities like digitization, transportation, and exhibition. A portion of platform revenues could be shared with artwork investors.
• Leveraging artwork collateral - The artwork collateralized on blockchain via DePIN could potentially be used to take loans against through DeFi protocols, allowing investors to capture liquidity without selling.
• Fractionalized ownership - Artwork NFTs could be fractionalized into smaller fungible tokens, allowing more investors to own a piece of a prestigious work and earn rewards.

In this way, investors can benefit from the various reward, commission and value enhancement systems due to the trusted provenance, digitization and liquidity that DePIN brings to fine art asset classes. This model incentivizes activities aimed at preserving the value of artworks. I know how to put it into practice.

[BitMet]

Hi. I want to raise this topic and have prepared a small review of an interesting article for this purpose.

In late July 2023, Vitalik Buterin (vitalik.eth) wrote an article titled “What do I think about biometric proof of personhood?”. As someone who develops blockchain applications and is passionate about tokenization of real assets, I always read and analyze such articles. As Iotex strives to gain its “place in the sun” I would like to share my thoughts with the community.

The article discusses different approaches to creating decentralized proof of personhood systems. These systems aim to verify that online accounts are controlled by unique real humans, without revealing their identities. The main approaches are:

1. Biometric systems like Worldcoin that use specialized hardware like iris scanners to verify humans. Pros: high privacy, hard to fake. Cons: hardware centralization risks, accessibility issues.
2. Biometric systems like Proof of Humanity that use general hardware like phone cameras. Pros: highly accessible. Cons: lower privacy, easier to fake.
3. Social graph systems like BrightID where existing users vouch for new users. Pros: no new hardware needed, pseudonymity friendly. Cons: bootstrapping challenges, social graph privacy risks.

The article argues we should take a combined approach, using specialized hardware for security, general hardware for accessibility, and social vouching for pseudonymity. All approaches have tradeoffs between values like privacy, accessibility, decentralization. More experimentation needed to find the right balance. The concept seems valuable despite risks, to provide an alternative to centralized identity systems.

In the paradigm of the material written in the article, how can these technologies be used in the tokenization of real assets and what is it for?

Based on the concepts discussed in the article, proof of personhood technologies could potentially be useful for tokenizing real assets in a few ways:

• Helping verify unique ownership of assets. The proof of personhood systems aim to verify unique real humans. A similar approach could verify real-world asset ownership by linking assets to verified identities.
• Preventing sybil attacks and fake identities in token systems. The proof of personhood approaches aim to prevent fake or duplicate identities. This could help make token systems built on real assets more secure against attacks and manipulation.
• Enabling governance rights and benefits tied to real assets. If real assets are tokenized, proof of personhood could enable the real humans verified to be owners to have governance rights like voting in a DAO managing a real asset. Or receive benefits like dividends.
• Facilitating transparent and accountable real asset transactions. By verifying real humans on both sides of transactions, proof of personhood could enable more transparent and accountable trading of tokenized real assets.
• Providing pseudonymity for asset owners. As mentioned in the article, some proof of personhood approaches allow for pseudonymity. This could allow real asset owners to get verification benefits without fully revealing their real-world identities.

Proof of personhood could be a useful primitive in building out systems and applications for tokenizing real assets in a way that ensures security, accountability, and owner rights. But as the article discusses, there are many open challenges and tradeoffs to work out.

The IoTeX community and developers can work together to address the open challenges and trade-offs associated with proving identity in real asset tokenization. This in turn will contribute to the growth and development of the IoTeX technology stack.

[baraeva]

Hi, Yulya here. I’m not really interested in real asset tokenization, but I work in the Cultural Space Kobzar and I’m a long-time follower of iotex, so I’m interested in the prosperity of these companies. We have many real assets in our collection that we will tokenize over time. I recently saw an interesting example of real estate tokenization and now I want to share it with you, because now it is important to study the experience of other projects as much as possible before launching your own.

Roofstock onChain. The offerings available through Roofstock onChain include non-fungible tokens referred to as Homes onChain, each representing a single-family property-owning limited liability company. Homes onChain are not offered through any real estate brokerage firm or agent and are not securities as defined by the U.S. Securities and Exchange Commission Act. Neither Roofstock onChain nor its agents, employees, or affiliates serve as your advisor, agent, broker, contracting agent, or fiduciary and do not provide, or offer to provide, financial, investment, legal, real estate, or tax advice.

Transacting on the blockchain, trading cybercurrency, and holding real property through a limited liability company may all have tax implications. You agree that you are solely responsible for determining what, if any, taxes apply to your transaction. All Roofstock onChain transactions are facilitated by Smart Contracts deployed on the Ethereum blockchain.

I was also interested in the possibility of providing liquidity to real assets using the Kettle portal. The platform envisions a future where every real-world asset finds its place in the digital sphere, unlocking unprecedented liquidity and value. This startup aspires to be the central hub for connecting tokenized real world assets to individuals and institutions seeking to generate value.

I want to believe that my post will be useful to our community.

[KiberDon]

Fresh news from the world of big money and asset tokenization!

JPMorgan Debuts Blockchain Collateral Settlement in BlackRock-Barclays Trade

JPMorgan’s Tokenized Collateral Network, or TCN, was used by BlackRock Inc. to turn shares in one of its money market funds into digital tokens, which were then transferred to Barclays Plc as collateral for an over-the-counter derivatives trade between the two institutions, Tyrone Lobban, head of Onyx Digital Assets at JPMorgan, said in an interview.

[kristina]

Deutsche Post, Germany’s postal service, has issued its first crypto stamp on the Polygon blockchain. The initiative combines the traditional artistry of physical stamps with NFT technology. The debut stamp in the series, featuring the iconic Brandenburg Gate, marks the beginning of the Historical Buildings collection.

Unlike the crypto stamps of other postal services, the German edition has unique features. Each physical stamp and corresponding NFT representation carries individual numbering, thanks to a unique matrix code. This ensures the authenticity and exclusivity of each crypto stamp, adding value for collectors.

The crypto stamp booklet, including the NFT version, is priced at €9.90, providing collectors with an affordable entry point into digital stamp collecting. However, it’s worth noting that the regular limited-edition stamp without the NFT component will also be available along with the crypto stamp, which is limited to 800,000 pieces.

Deutsche Post has chosen the Polygon blockchain as the basis for its NFT crypto brand. Polygon, known for its robust NFT capabilities, runs on a Proof of Stake (PoS) consensus mechanism, making it energy efficient compared to other blockchain networks. This choice is in line with Deutsche Post’s commitment to sustainability and reducing its environmental impact.

I believe that the IoTeX blockchain is as good as or even better than the Polygon blockchain, but the IoTeX team is currently neglecting the tokenization of real assets. This is a mistake, because with proper funding (small in the scale of IoTeX) the team of cultural space Kobzar can successfully implement several bright initiatives, including those with Ukrposhta (postal operator of Ukraine).

[James2]

Agreed to this line of thought

[baraeva]

Hi friends, as an aspiring artist (I even sold my first painting recently) I am interested in starting tokenizing my paintings as soon as possible.

I’m cheating of course, but using my position I was able to use a print of my painting as a title photo for a blog article. If this picture was tokenized, in theory, the new owner of the picture and I could receive future dividends from the use of my copyright in pre-programmed shares.

[m1m2]

An interesting article published today on the IoTeX blog, What are Real World Assets (RWA) and DePIN? This article provides a link to an interesting tutorial “An Unreal Primer on Real World Assets”.

[BitMet]

Hello everyone! I like that interesting discussions are starting in the IoTeX project. Therefore, I want to bring up a very important topic that developers may encounter in the future. During the NFT hype, I raised the issue of copying the same artwork and minting NFTs with the same image on different blockchains. Now I understand the reality of NFT trading, but a few years ago, this issue concerned me. To address this problem, we developed an NFT image parser from all major marketplaces and compared these images with the desired NFT image. This way, we hoped to combat NFT plagiarism across different blockchains. However, in the end, my work turned out to be unnecessary, and I stopped development.

But with the tokenization of RWA and, for example, the creation of NFTs with a digital fingerprint of a real asset, the problem repeats itself. How do we make it impossible to pledge the same real asset in different blockchains? I suggest reflecting on this question before discussing the liquidity support of stablecoins using RWA.

[kristina]

@BitMet

But with the tokenization of RWA and, for example, the creation of NFTs with a digital fingerprint of a real asset, the problem repeats itself. How do we make it impossible to pledge the same real asset in different blockchains? I suggest reflecting on this question before discussing the liquidity support of stablecoins using RWA.

It seems to me that you have to insure the asset with an insurance company and thus, by having an insurance policy on the asset, the issue of the actual collateral becomes the insurance company’s problem

[kristina]

Before real-world asset (RWA) tokenization can begin, a lot of real-world items need to be digitized in detail. We at Cultural Space Kobzar in the framework of cooperation with projects interested in RWA tokenization do a lot of work on digitization of unique and inimitable assets.

This painstaking work protects tokenized assets from counterfeiting and allows us to create a high-quality digital imprint of RWA. In the photo, two staff members photograph and prepare a detailed description of an item before tokenizing it.

[m1m2]

Merry Christmas, IoTeX Community!

Wishing you a season filled with joy, warmth, and the magic of the holidays! As we reflect on the incredible journey of the past year, let’s celebrate the spirit of collaboration and innovation that defines our IoTeX family.

May your homes be filled with laughter, your hearts with gratitude, and your blockchain endeavors with continued success. Here’s to the bonds we’ve forged and the exciting possibilities that the New Year holds for our decentralized universe.

Thank you for being a vital part of the IoTeX community. May your days be merry and bright, and your blockchain visions come to life in the coming year!

Happy Holidays and a Prosperous New Year!

[vikavi]

This is one of the devices that are used in the process of tokenization of real assets. More details next 2024.

IoTeX University will teach you how to make these smart DePin devices (IoT) and manage them in the IoTeX network.

[BitMet]

Hi everyone, thank you friends for your activity in this topic, created by me. Your posts have helped me a lot in my work. I can call myself an active member of the global IoTeX community, so I take the liberty to make a small announcement.

In 2024, my colleagues from cryptocoinexpert and I have prepared a lot of technical and educational materials that are useful for the whole IoTeX ecosystem. The year 2023 showed that IoTeX is on the path of innovation, so I would like to wish all active members of the IoTeX community success and prosperity in 2024!

[m1m2]

Swiss cryptocurrency storage and trading company Taurus has received the green light from Swiss financial regulator FINMA to offer blockchain-based shares in unlisted companies to retail investors, a move that will bring tokenized securities to the masses.

The TDX Taurus trading platform, backed by Deutsche Bank (DBK), allows transactions using cryptocurrency as well as Swiss franc (CHF), euro (EUR) and US dollar (USD). A number of Swiss firms have chosen TDX to issue and list their shares.

According to the founder of TDX Taurus, retail investors can now participate in raising capital for unlisted firms in the primary market and can also participate in secondary markets.

Source: coindesk.com