Tokenized Strategy

Definition ∞ A tokenized strategy involves representing a specific investment approach, trading algorithm, or financial product as a digital token on a blockchain. This allows for fractional ownership, increased liquidity, and automated execution of the underlying strategy through smart contracts. Investors can gain exposure to complex financial methodologies by holding a single token, which abstracts away the operational complexities. It makes sophisticated financial products more accessible.
Context ∞ Crypto news frequently covers the emergence of tokenized strategies in decentralized finance, particularly those offering yield generation, automated trading, or exposure to real-world assets. Reports often discuss the risks associated with smart contract vulnerabilities, the transparency of the underlying strategy, and the regulatory implications of such financial products. These strategies represent a significant evolution in how financial services can be delivered and consumed within digital asset markets.