Tokenized Reserves

Definition ∞ Tokenized reserves are physical or digital assets that have been converted into blockchain-based tokens, representing ownership or a claim on the underlying asset. These tokens exist on a distributed ledger and can be traded or transferred with the efficiencies of blockchain technology. Examples include tokenized gold, real estate, or even fiat currency held in a bank account. This process enhances liquidity, transparency, and divisibility of traditional assets.
Context ∞ News about tokenized reserves often highlights new projects bringing real-world assets onto blockchains or regulatory developments concerning their legal status. The primary discussion revolves around the legal enforceability of claims on underlying assets and the auditability of these reserves. The expansion of tokenized reserves is a key trend in bridging traditional finance with decentralized digital asset systems.