Real estate, stocks, gold, carbon, and oil have markets in the multiple trillions of dollars. Tokenization is the process of transforming these “real world” assets into digital tokens that represent them, making them divisible, liquid and more transparent.
Asset tokenization will greatly reduce overhead costs and fraud. However, for one particular asset, it goes beyond that. The diamond industry faces a different problem than most assets; the lack of fungibility. Assets possessing this fungibility property simplify the exchange and trade processes, as interchangeability assumes a certain class of goods are valued the same way.
Every gram of gold is worth the same as any other gram, just as every barrel of oil is worth the same as any other barrel. But for diamonds, there isn’t any single metric that can be used to determine a stone’s value.
As a result of this lack of fungibility, the diamond market is extremely limited in who can participate. Only those with industry-specific expertise manage to trade diamonds profitably, while amateurs who try to resell a diamond commonly face losses between 30-50% of the fair market value.
Diamonds are also difficult to transfer because they require high levels of security and transparency. Counterfeits are an ever-present risk, so careful inspections must also be carried out each time ownership of a diamond changes hands.
Sixlinx Technologies’ tokenization of diamonds through blockchain technology is a potentially revolutionary idea. Sixlinx Technologies promises to bridge the gap between the traditional diamond industry and modern financial markets, enabling people to invest in and liquidate diamonds the same way they would any other financial asset.
Individuals may possibly purchase individual diamonds, diamond ETFs, or shares in a collection of diamonds called a diamond basket. Sixlinx Technologies has certainly the most exciting application of asset tokenization because of all of the potentials it unlocks.
By tokenizing diamonds, traders can now go on a blockchain-based exchange and look through the diamonds and diamond baskets listed there, all of which are transparently priced. Meanwhile, sellers have a new distribution channel that requires minimal effort and cost to maintain. And diamond holders who have been unable to get a fair value for their stones benefit most, as the liquidity, standardization, and transparency created by Sixlinx Technologies mean that they don’t have to settle for low-ball offers from retailers and pawn shops anymore.
This is just the beginning and other major assets will expectedly follow suit and be tokenized in the near future. The transparency and trustlessness of blockchain technology can improve just about every financial market in the world. However, diamond tokenization has already arrived, and Sixlinx Technologies seems to be at the forefront of the diamond revolution.
For more information, visit: http://sixlinx.io
Company Name: Sixlinx Technologies
Contact Person: Louis Vance
Email: Send Email
Phone: +1 303 262 6260
Address:Dominion Plaza 600 17th St
State: CO 80202
Country: United States