Digital Asset

Digital asset refers to the assets, which exists only in the digital form. Most of stocks and shares exist only as digital assets. All blockchain-based assets exist only in the digital form too.

Traditional assets – let’s think about real estate, land, cars – are physical assets. They are recorded in the government asset registries, which define who owns which assets. The transfers of the assets are registered in these central asset registries, using these assets as collateral against the loan and other transactions are recorded too.

Financial assets – stocks, bonds, options, futures – are usually (with some exceptions) in the digital form. The central securities depositories record the ownerships and the transfer of these assets.

Blockchain-based digital assets are the next step – these digital assets are not stored in central securities depositories, but they are stored in the cryptographically protected distributed databases – in the blockchains. Blockchain-based digital assets have a significant advantage to the digital financial assets – that’s the settlement. While the settlement of financial assets can take up to three business days, the settlement of blockchain-based digital assets is done within a minute or less.