The types of tokenization

What are the types of tokenization and what they mean.

Blockchain has unleashed a global net market for digital assets.

But there's an even bigger market waiting to be released: it's trillions of dollars in real-world assets. Including real estate, small businesses, commodities and more.

Tokenization emerges allowing these assets to be traded easily on a global exchange. There are 3 tokenization classes. Follow the explanatory table:

Class 1 Tokens are of Native Utility, can be transferred in a decentralized ledger from user 1 to user 2, but don’t grant any rights to a counterparty. The owner of a native utility token has no relative or absolute right except the right related to token itself.⠀⠀⠀ ⠀⠀⠀⠀⠀⠀⠀⠀⠀ ⠀⠀⠀⠀⠀⠀⠀⠀⠀

  • There are the Basic Tokens, the most popularly known, which are payment tokens that function as medium of exchange, unit of account and store of value providing access to an underlying technology, i.e. the famous cryptocurrencies.

  • There are also Tokens of Access to Infrastructure, payment and/or utilities tokens, which allow access to enhanced functionality infrastructure, like the Ether.

  • Beyond these, the Application Access Token, also payment and/or utility token, access to decentralized application or platform, also without legal claim against a courter-party.

  • Finally, there are the Application Settlement tokens, which in addition to the functionality of other tokens, it also uses as a 2P2 settlement instrument in an application/platform.

Class 2 Tokens are counterparty, include any form of relative right against a third party, such as the (legal) right to use token generator services, the right to receive a financial payment, the right to receive an asset or a right package shareholders. ⠀⠀⠀⠀⠀⠀⠀

  • There are IOU Tokens, equivalents a payment, utility and/or asset tokens, tokenization of a claim against a legal counterparty. ⠀⠀⠀⠀⠀

  • The Derivatives Tokens are asset tokens, that tokenization of a claim and derives from an underlying onor off-chain base value.⠀⠀⠀ ⠀⠀⠀⠀⠀⠀⠀⠀⠀

  • Already the Found Tokens, also as asset tokens, tokenization of a fund share.⠀⠀⠀⠀⠀⠀

  • The Equity Tokens, also as asset tokens, tokenization of a corporate membership and equity related shareholder’s and financial rights.⠀ ⠀⠀⠀⠀⠀⠀⠀⠀⠀

  • Membership tokens, as the name itself already says, is a tokenization of a personal membership.

Class 3 Tokens are owned, includes cases where Token provides SCS-based technical property rights. The purpose of a BCP Class 3 token is to transfer rights from associated assets by transferring the Token. These assets may include IP rights (for example, copyright) and may also include material objects in certain jurisdictions. Unlike BCP Class 2, BCP Class 3 Token holders don’t have a claim or relative rights against a counterparty. Instead, BCP Class 3 Tokens provide absolute rights (erga omnes) in the form of a real right of associated assets, such as:⠀⠀⠀⠀⠀⠀⠀

  • Joint-ownership tokens.⠀ ⠀⠀⠀⠀⠀⠀⠀⠀⠀

  • Co-ownership tokens.⠀⠀ ⠀⠀⠀⠀⠀⠀⠀⠀⠀

  • Sole-ownership tokes.

This was the first of a series of authorial content prepared by experts in the field to expand their knowledge in this market. To follow content like this, subscribe to our newsletter!

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