¡ Hasta la VISTA, baby! If you think of Vista as an old-fashioned, delightfully vintage (2007) operating system, you’re in for a change. Forget blue screens, because the future will be as white as snow. The Foundation Avalanche invests $50 million in the future. The future is tokenization of real assetsand the Avalanche Vista initiative is here to help. Put on your snowboard and get started!
Did you say token?
Let’s go back to basics. If the term « token may sound familiar, but do you really know what it means? A token, or jeton for the more francophile among you, is a unit of value representing one asset issued and traded on a specific blockchain. While cryptocurrencies do meet this definition, it is also possible to use the underlying technology to represent any real-world asset. In this way, stocks, real estate and commodities can be converted into their digital alter egos.
But if they can be acquired on traditional financial markets, what’s the best way to do it? their virtual aliases? To put it simply, investing in a rental property requires capital, usually in the form of a loan from a bank. You are obliged to buy the entire building or apartment in order to collect the rent. On the blockchainthe principle is different. If a bitcoin can represent a certain sum, you can take only a few fragments, called satoshis. The same applies to any tokenized asset. In other words, the main advantage of tokenization is that it opens the doors to theinvestment to as many people as possible.
Avalanche Vista supports tokenization of real assets
To support this paradigm shift, Ava Labs offers undeniable advantages. The use of Avalanche’s proprietary consensus and subnet architecture are advantages for projects wishing to operate in the field of tokenized off-chain assets. As a result, the fund is aimed primarily at « that have a clear value proposition, a comprehensive go-to-market strategy and a considered vision of product-market fit. »
« Tokenization of assets is not just the future of capital markets. It is an essential driver of the present. »
John Wu, President, Ava Labs
This movement follows the growing interest of financial institutions in tokenization. For example, BlackRock predicts « monumental » change thanks to this technology. Joseph ChalomHead of Strategic Partnerships, recently said:
« The institutional adoption of tokenization will make a monumental contribution to shaping our ecosystem. »
BlackRock, after all, is an investment behemoth with $8,000 billion in assets under management. Suffice to say, its opinion carries weight in the global economy.
Another venerable institution is taking a hard look at the issue. It is, Bank of America is eyeing the gold tokenization market. This sector is worth at least $1 billion.
The advantages of tokenization of real assets according to Avalanche
Ava Labs proposes to overcome several challenges, which are all obstacles to investment in the asset classes concerned.
Automation and cost reduction
Visit smart contracts make it possible to automate the processes of issuing, managing and settling assets. This leads to cost optimization by eliminating intermediaries. What’s more, they facilitate the administration of tasks performed manually in traditional finance.
Transparency and auditability
All transactions carried out on a public blockchain is verifiable. This makes it much easier to value the underlying assets. This would make property valuation much more transparent.
Increased liquidity
The advantage of tokenization is that it opens access to a greater number of investors. This stimulates supply and demand, and makes for a more liquid and less expensive secondary market.
These are just a few of the benefits of this innovation. Many others remain to be defined. However, for this economic metamorphosis to succeed, it will be necessary to overcome a number of obstacles. numerous obstacles set up by the regulations or lack thereof.
In any case tokenization of real assets hosts debates at the highest international level. Indeed, the subject was raised at the last World Economic Forum. Avalanche Vista is undeniably part of this movement, which will profoundly change the face of the economy.