Definition ∞ Tokenization Capabilities refer to the inherent capacity of a system or platform to convert rights to an asset into a digital token on a blockchain. This process involves creating a digital representation of a real-world or digital asset, recorded on a distributed ledger. These capabilities enable fractional ownership, increased liquidity, and automated management of various asset types. It transforms how value is represented and exchanged digitally.
Context ∞ News often highlights tokenization capabilities being applied to diverse asset classes, from real estate and art to securities and intellectual property. This technology holds the potential to democratize access to investments and streamline asset transfers within financial markets. The expansion of tokenization capabilities is a significant trend shaping the future of digital assets and the broader financial landscape.