Definition ∞ An investment trust token represents a fractional ownership interest in an underlying investment trust, which holds a portfolio of assets. These tokens grant holders economic rights tied to the performance of the trust’s holdings, such as dividends or capital gains. By tokenizing trust units, they offer increased liquidity, divisibility, and accessibility to a broader range of investors. This structure merges traditional investment vehicles with blockchain technology.
Context ∞ Investment trust tokens are a growing area of interest in digital asset markets, particularly as traditional financial institutions explore tokenization. News often reports on the creation of such tokens backed by real-world assets like real estate, commodities, or even other cryptocurrencies. Their development is seen as a step towards bridging conventional finance with decentralized finance, potentially democratizing access to various asset classes and streamlining investment processes. Regulatory clarity surrounding these tokens is a key factor for their wider acceptance.
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