Physical Asset Digitization

Definition ∞ Physical Asset Digitization involves creating a digital representation or token of a tangible real-world asset on a blockchain. This process links a physical item, such as real estate, art, or commodities, to a unique digital token, thereby transferring its ownership or value digitally. It enables fractional ownership, improves liquidity, and simplifies transfer processes by removing intermediaries. This method offers a secure and transparent way to manage and trade physical assets.
Context ∞ Physical asset digitization is a significant trend in crypto and financial news, often highlighted for its potential to unlock new markets and investment opportunities. Discussions frequently center on the legal frameworks required to ensure the enforceability of digital ownership and the technological standards for accurate representation. The increasing adoption of this process is transforming how traditional assets are valued, traded, and managed.