Tokenization is the process of converting different objects into tokens, which are digital assets. Typically, tokens run on blockchains and are managed by algorithms and smart contracts. Assets of many different kinds can be tokenized. One can tokenize, for instance, shares of stock in a firm, real estate, and works of art.
Because it makes it easier for businesses to raise money by selling assets on the open market, tokenization is growing in popularity. Companies who don’t want to deal with the IPO procedure, for instance, may decide to issue tokens instead of stock offerings. Blockchain tokens are frequently exchanged on cryptocurrency exchanges, where supply and demand can cause price fluctuations.