Launch A Tokenization Platform 
In A Blink With CPI Tech

As we know, tokenization is a multi-stage process that usually converts real-world assets (RWAs) into digital tokens. This process involves several key elements in addition to the tokens themselves. They may not be that familiar, but you must be aware of them:

• Smart contract — these are self-executing contracts that have the terms of the agreement directly written into their code. These contracts run on a blockchain and automatically execute and enforce agreements between issuers and buyers when predefined conditions are met. With them, companies and investors don't need intermediaries and can streamline the investment process without the risk of disputes.

• Token standard — it's a set of guidelines for creating digital tokens on a blockchain. These standards ensure interoperability between different tokens and platforms. Common standards include ERC-20, ERC-721, and ERC-1155 for Ethereum-based tokens.

• Fungible tokens — this means tokens are interchangeable and mutually indistinguishable from each other. Cryptocurrencies like Ethereum and most stablecoins are fungible. If you have one Ethereum and exchange it for another, you still have one Ethereum at the same value. It works similarly to fiat money, like dollars or euros.

• Non-fungible tokens — these tokens are unique and distinct from each other. Each has specific characteristics and represents ownership or proof of authenticity for a specific asset. For instance, STOs may issue either fungible or non-fungible tokens. If the STO token represents ownership in a fractionalized or divisible asset (such as real estate or equity), it is likely to be fungible. However, if the STO token represents ownership of a unique and indivisible asset, it may be designed as a non-fungible token (NFT). All you need is just to decide before starting STO platform development. 

Now that you are familiar with the basics, here is a step-by-step outline of the process: 

1. Identify the asset you want to tokenize. It can be real estate, art, equity, debt, or any other valuable asset.

2. Ensure you meet regulatory requirements specific to the asset and jurisdiction. For instance, if you launch STO, check whether you adhere to securities laws, property laws, and any other relevant regulations.

3. Draft legal documentation detailing the terms and conditions of the tokenized asset that should include ownership rights, potential profit-sharing, or any other features. This may include a Token Offering Memorandum (TOM) or a Private Placement Memorandum (PPM).

4. Choose a token standard that better aligns with the asset. Common standards include ERC-20 for fungible tokens and ERC-721 for non-fungible tokens.

5. Integrate the terms into smart contracts and deploy them on a chosen blockchain platform. As a result, it will issue tokens.

6. Organize a tokensale or distribute the tokens to investors. This can be done through a Security Token Offering (STO), Initial Coin Offering (ICO), private placements, or other regulatory-compliant means.

Tokenization platforms are digital frameworks or software solutions that facilitate the creation, issuance, and management of digital tokens on a blockchain. Compared to coding tokens yourself, created by a tokenization platform development company, this platform already has all the tools to tokenize real-world assets and manage or even sell their tokens. This way, companies can increase asset liquidity in a more secure, transparent, and efficient manner.

The applicability of tokenization spans various sectors, and companies can benefit from increased efficiency, decentralization, transparency, and accessibility to raise funds. So, regardless of your area, tokenization can offer immense opportunities.

Tokenization is considered by many as the future of fundraising, thanks to its 5 key characteristics:

1. Liquidity: By utilizing tokenization, it becomes possible to offer shares of assets such as real estate, art, or securities in smaller, tradeable quantities. This improves the liquidity of these assets and broadens the potential for investment among a diverse group of investors who may not have previously had access to these markets. 

2. Security: Tokenization combines cryptographic hash functions with strict KYC (Know your customer) control and peer-to-peer transactions to ensure the integrity of the system. As a result, any tampering with the system or fraudulent activity will be highly detectable and less likely to occur.

3. Transparency: Using blockchain technology for tokenization creates a clear and unalterable record of ownership and transactions. This transparency fosters trust among participants, reduces the risk of fraudulent activity, and bolsters the overall integrity of the system.

4. Democratization: Tokenization makes it possible for everyone to have equal access to investment options, eliminating traditional obstacles. This creates opportunities for individual investors to join in on asset classes that were once only available to large organizations, promoting a more inclusive financial world. In addition, enterprises have two accessible options on how to approach tokenization: either through the fast and reliable development of white label tokenization platform or custom tokenization platform development tailored to your needs.

5. Interoperability: By adopting shared guidelines such as ERC-20 and ERC-721, tokenization encourages seamless interaction between various blockchain systems. This increased interoperability simplifies the transfer of tokens across different ecosystems, ultimately leading to a more interconnected and adaptable financial environment.