Goldman Sachs is one of the banks that have been delving deep into the world of cryptocurrencies. So, it doesn’t come as a surprise that they have been exploring the NFTs space. Inspired by that, reports suggest that Goldman Sachs plans to tokenize real-world assets. The company is also working with NFTs in collaborating with financial instruments.
Tokenization of real-world assets
By tokenizing real-world assets, they can be purchased and owned over the internet through blockchain technology. The idea is similar to NFTs, where the same process is followed mostly for art. With Metaverse becoming a hot topic in the crypto space, the tokenization of real-world assets is actually something that will play a huge role.
What is tokenization?
Tokenization is the process of dividing the ownership of an asset into digital tokens. It is similar to dividing the ownership of a company into equity and is just like NFTs. But in this case, they are fungible tokens and represent the value of the asset.
A good example of this is the makeup brand Oddity which has recently tied its IPO to security tokens. This allows them to raise funds before they go public. Once their IPO happens, the security tokens will get converted to Class A shares automatically. So, it is clear that tokenization of real-world assets does open up a ton of possibilities.
About Goldman Sachs
Goldman Sachs was founded in 1869 and is headquartered at 200 West Street in Lower Manhattan, with regional offices in London, Warsaw, Bangalore, Hong Kong, Tokyo, and Salt Lake City, as well as locations in other worldwide financial cities.
It is placed second on the world’s list of investment banks by revenue and 59th on the Fortune 500 list of the top firms in the United States by total revenue. The Financial Stability Board considers it a systemically significant financial institution.
They have openly criticized cryptocurrencies during 2017-18 but have changed their views recently. In fact, they were one of the first US firms to offer crypto trading services to their clients.
What are your thoughts as Goldman Sachs plans to tokenize real-world assets? And do other applications other than security tokens come to your mind? Let us know in the comments below. Also, if you found our content informative, do like and share it with your friends.
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