Tokenization has been scripting new milestones growing at a CAGR of 21.4% from 2024 onwards and it is expected that in the next 5 years, it will reach a whopping $10 B in market cap. In this blog, we shall how industry players from different sectors are using tokenization to resolve some of their innate challenges;

How Tokenization Is Resolving Key Issues In Various Sectors with Realtime Adoption by Key Players?

In the last couple of years, private equity has increased significantly to $13.4 trillion in investments as per the WEF report. But there are few areas where this sector has been struggling like;

1. Asset issuance: This is a key problem when you are going for Private Equity expansion to cross borders for profits. Because the fund managers are easily governed in their own jurisdiction but when they go beyond their own jurisdiction, they need to outsource the task which can significantly impact operations and bring down the profits to lower limits as evident from the chart below;

This is happening because they have to register their private equity assets like single-family homes to hospitals, software companies, and telecom infrastructures, and so on and so forth as a hedge against the funds that they intend to issue in a foreign market. But in the absence of scalable technology that can help circumvent the odds, they have to take the hard route to issue assets and get returns from such issuance.

1. Asset Trading: Asset Trading is another segment where Private Equity faces core challenges because of counter-party risks involved. Though there are CCHs and CSDs designated with the role to simplify clearance, not only do they charge a premium for the same but they too depend on intermediaries for clearing. Which means, if one of the chains breaks in between, the risk mitigation can be put on a standstill mode.

cess capital is in question with respect to the demand put forward. Which means, there’s always an innate risk involved when there are higher dependencies on counterparties to pay up on demand.

1. Asset Servicing and Redemption: At the time, when the firms/ asset managers are looking forward to making the payments like interest, principal, or dividends, they need to figure out the shareholders. As a result, they will have to repeatedly talk to the registrar for data and the registrars will end up providing the same in exchange for some fees. This significantly can impact their ROIs. For context, there’s a 27% markup cost to process data and pay benefits to the shareholders.

Tokenizing is changing this game for private equity and asset managers because key players like BlackRock are tokenizing to mitigate all the obstacles. For example, BlackRock’s BUIDL Fund launched using blockchain not only gives operational efficiency but also streamlines 24/7/365 trading and settlements. The fund uses blockchain as an underlying technology to launch the BUIDL fund and quickly disburse the funds. Recently, BUIDL fund has moved to the Binance Chain from the Ethereum Chain to tap into extended liquidity and manage compliance in the process.

Along with BlackRock, HSBC is also launching tokenized gold. And BNY has launched tokenized deposits for streamlining near 24/7 near instant settlements.

In Real Estate

From property frauds to forgery to misrepresentation and alternation, the real estate sector has been battling for centuries to overcome these challenges. But dependency on old technologies doesn’t provide the right infrastructure to help dodge the following challenges;

Transparency: Transparency is a major barrier in any real-estate transaction because there’s no way you can validate the authenticity of a document carrying the ownership right of a property. As a result, there’s title fraud which has gone rampant and unchecked at the moment.

Despite taking measures to curtail the same, all the respondents feel that an electronic system could easily mitigate the problem as per this survey to not just enforce transparency but also lead further to accountability;

Inefficient Process: Inefficient process is the next major drawback because transferring an ownership or listing properties can take from months to a full year for completion. Due to these challenges, the real estate sector is losing 3 % to 7% revenue annually because of the traditional/ legacy software failing to speed up listing, verification and transfers .

Limited Property Access: Access to property overseas could be challenging when you want to invest in real estate due to regulatory hurdles. Though you have REITs, they have entry barriers. For example, minimum investments fall within the limits of $1000 to $1500, which might get costly for many of the investors.

Through tokenization, all these problems are getting addressed in the real estate sector with some real time examples. Like Propy which is using the blockchain technology to revolutionize property ownership, handling and transfers.

So far, Propy, by using blockchain technology to release tokenized variation of real estate properties has smoothened documentation, streamlined sale of high value property and even contributed to global property sales. Through their contributions, at the moment, Propy has undertaken a $100 M investments using perfect amalgamation of blockchain and AI to quickly acquire titles and rid the segment from over dependency on manual processes.

And Propy is not the only player using tokenization in real-estate, its close counterparts like RealT is also allowing investors from overseas to buy properties in the US in a tokenized form.

In Supplychain

As per a report, the global supply chain market is projected to grow from USD 25.67 billion in 2024 to USD 48.59 billion by 2030 at a CAGR of 11.4%. But there are few challenges that supply chains must address requiring technological innovation for a smooth growth like;

Regulatory Challenges: There are multiple regulatory challenges that one must address when they are engaged in cross border supply chain management. For example, in the EU region, there are multiple laws in action like the Corporate Sustainability Due Diligence Directive (CSDDD), EU Deforestation Regulation (EUDR), and Critical Raw Materials Act (CRMA).

Under these, the sourcing partners have to provide all the details of the materials entering and leaving the EU region. Failing to do so would result in penalties imposed to the tune of EUR 10 to EUR 50 per tonne for unreported emissions. In addition to this, there’s EU Deforestation Regulation, wherein, if the suppliers are failing to provide the necessary data, they will have to pay the penalty of 4% of the company’s annual EU-wide turnover.

So companies will have to provide data for the same which means setting up intermediaries to provide the same at large and on demand. And this practice can be highly costly.

Transparency: Demand of the consumers is also changing at a brisk pace. For example, now it is not just the price acting as a decisive factor but also accountability towards the environment.For example, as per reports, consumers are willing to pay a premium price as well if the product involved is manufactured using sustainable means. Which means, the product should have an infrastructure in place that can help verify its authenticity.

GeoPolitical Shifts: Geopolitical shifts is the next problem which can severely affect supply chains because during wars or other events, companies are looking for a better collaborative method to help circumvent the odds and trade at free will. In this regard, they need information dissemination in a scalable, secure and collaborative manner.

To solve all these problems, tokenization has ended up as a perfect solution for the supply chain segment because some of the players are extensively using the same to extract benefits from this like;

1. Walmart: Which has partnered with VeChain, IBM, DL Freight and Zero Cash to address problems like transparency, freight invoicing, and payments. Through the use of tokenization, Walmart was able to reduce wastage by 25% and integrate with more than 50+ ports in a paperless and scalable way.

2. Nestle and Pepsico: They are using tokenization to validate their sustainable contribution. So when customers sought for their contribution to protecting the environment, they provided verifiable proof using blockchain . As a result, they witnessed a significant jump in sales and profits;

In Energy

At the moment, out of 8 billion population worldwide, more than more than 730 million people are living without electricity despite majority of the areas claiming that they have been electrified because of the following challenges;

1. Access to Resources: There’s very limited financial resources available to streamline rural electrification. For example, in the sub- saharan region alone, the average investment required for complete electrification stands at around $55 B but the actual funding given is around $30 B. This is primarily happening because for the purpose of rural electrification, the need is to establish a gratification model wherein private players can participate and help in the process.

But often these processes are mired in controversies and complexities, alienating the private players to actively participate in it. And despite these odds, even if private players intend to participate, they have another barrier to cross like the cost of procuring the licensing and provisioning, which shouldn’t exceed 2%.

But in reality, they have to spend 10% or even more. And tariff regulations further exacerbate the situation which leads to their inability to recover even the basic cost. And even if they cross all the hurdles and still set-up the infrastructure, the last nail in the coffin is electricity thefts by users, which puts a bill of $16 on the head of the private power companies. Thereby, completely making their operations non motivating.

2. Energy Trading: Energy trading is another major barrier because there are many villages which are energy farming through natural ways like solar panels but they are not able to supply that electricity to the point of demand.

But this process is not that simple because they have to set up an expensive solution for the same like ground-mounted solar power plant, storage system, and rooftop photovoltaics. All of these are costly affairs and they demand funding. The need is to set-up a trading market where anyone that intends to participate can contribute to energy trading. And that’s where tokenization is solving the problem.

A prime example of how energy players are using tokenization to provide low cost electrification using blockchain as an underlying layer are:

(1) Schneider Electric: Schneider Electric and Arensis have joined hands to set-up a smart microgrid system. They are using the blockchain technology to

launch energy tokens which will be used to not just provide funding for setting up these grids and managing the same in a completely transparent, decentralized and scalable manner, but also act as a medium of exchange for supplying excessively produced electricity to low supply regions through these grids.

(2) Brooklyn Microgrid, a blockchain enabled community power hub is also using tokenization, where they are storing the excess power they generate in Lithium ion batteries and supplying the same to regions which are struggling due to lack of power.

If you are planning to build anything around tokenization, Zeeve can be your trusted partner.

If you want to claim your share from the vast ocean of tokenization across all sectors as evident from the chart below, you need a trusted partner.

Zeeve as a trusted, specialized enterprise grade blockchain infrastructure company can help you in all your pursuits. We provide every essence of support that you need from guidance to interaction and more. Want to disrupt the market and don’t know where to start from, talk to our experts and we shall help you in all possible ways.

Tokenization has been scripting new milestones growing at a CAGR of 21.4% from 2024 onwards and it is expected that in the next 5 years, it will reach a whopping $10 B in market cap. In this blog, we shall how industry players from different sectors are using tokenization to resolve some of their innate challenges;

How Tokenization Is Resolving Key Issues In Various Sectors with Realtime Adoption by Key Players?

In the last couple of years, private equity has increased significantly to $13.4 trillion in investments as per the WEF report. But there are few areas where this sector has been struggling like;

1. Asset issuance: This is a key problem when you are going for Private Equity expansion to cross borders for profits. Because the fund managers are easily governed in their own jurisdiction but when they go beyond their own jurisdiction, they need to outsource the task which can significantly impact operations and bring down the profits to lower limits as evident from the chart below;

This is happening because they have to register their private equity assets like single-family homes to hospitals, software companies, and telecom infrastructures, and so on and so forth as a hedge against the funds that they intend to issue in a foreign market. But in the absence of scalable technology that can help circumvent the odds, they have to take the hard route to issue assets and get returns from such issuance.

1. Asset Trading: Asset Trading is another segment where Private Equity faces core challenges because of counter-party risks involved. Though there are CCHs and CSDs designated with the role to simplify clearance, not only do they charge a premium for the same but they too depend on intermediaries for clearing. Which means, if one of the chains breaks in between, the risk mitigation can be put on a standstill mode.

cess capital is in question with respect to the demand put forward. Which means, there’s always an innate risk involved when there are higher dependencies on counterparties to pay up on demand.

1. Asset Servicing and Redemption: At the time, when the firms/ asset managers are looking forward to making the payments like interest, principal, or dividends, they need to figure out the shareholders. As a result, they will have to repeatedly talk to the registrar for data and the registrars will end up providing the same in exchange for some fees. This significantly can impact their ROIs. For context, there’s a 27% markup cost to process data and pay benefits to the shareholders.

Tokenizing is changing this game for private equity and asset managers because key players like BlackRock are tokenizing to mitigate all the obstacles. For example, BlackRock’s BUIDL Fund launched using blockchain not only gives operational efficiency but also streamlines 24/7/365 trading and settlements. The fund uses blockchain as an underlying technology to launch the BUIDL fund and quickly disburse the funds. Recently, BUIDL fund has moved to the Binance Chain from the Ethereum Chain to tap into extended liquidity and manage compliance in the process.

Along with BlackRock, HSBC is also launching tokenized gold. And BNY has launched tokenized deposits for streamlining near 24/7 near instant settlements.

In Real Estate

From property frauds to forgery to misrepresentation and alternation, the real estate sector has been battling for centuries to overcome these challenges. But dependency on old technologies doesn’t provide the right infrastructure to help dodge the following challenges;

Transparency: Transparency is a major barrier in any real-estate transaction because there’s no way you can validate the authenticity of a document carrying the ownership right of a property. As a result, there’s title fraud which has gone rampant and unchecked at the moment.

Despite taking measures to curtail the same, all the respondents feel that an electronic system could easily mitigate the problem as per this survey to not just enforce transparency but also lead further to accountability;

Inefficient Process: Inefficient process is the next major drawback because transferring an ownership or listing properties can take from months to a full year for completion. Due to these challenges, the real estate sector is losing 3 % to 7% revenue annually because of the traditional/ legacy software failing to speed up listing, verification and transfers .

Limited Property Access: Access to property overseas could be challenging when you want to invest in real estate due to regulatory hurdles. Though you have REITs, they have entry barriers. For example, minimum investments fall within the limits of $1000 to $1500, which might get costly for many of the investors.

Through tokenization, all these problems are getting addressed in the real estate sector with some real time examples. Like Propy which is using the blockchain technology to revolutionize property ownership, handling and transfers.

So far, Propy, by using blockchain technology to release tokenized variation of real estate properties has smoothened documentation, streamlined sale of high value property and even contributed to global property sales. Through their contributions, at the moment, Propy has undertaken a $100 M investments using perfect amalgamation of blockchain and AI to quickly acquire titles and rid the segment from over dependency on manual processes.

And Propy is not the only player using tokenization in real-estate, its close counterparts like RealT is also allowing investors from overseas to buy properties in the US in a tokenized form.

In Supplychain

As per a report, the global supply chain market is projected to grow from USD 25.67 billion in 2024 to USD 48.59 billion by 2030 at a CAGR of 11.4%. But there are few challenges that supply chains must address requiring technological innovation for a smooth growth like;

Regulatory Challenges: There are multiple regulatory challenges that one must address when they are engaged in cross border supply chain management. For example, in the EU region, there are multiple laws in action like the Corporate Sustainability Due Diligence Directive (CSDDD), EU Deforestation Regulation (EUDR), and Critical Raw Materials Act (CRMA).

Under these, the sourcing partners have to provide all the details of the materials entering and leaving the EU region. Failing to do so would result in penalties imposed to the tune of EUR 10 to EUR 50 per tonne for unreported emissions. In addition to this, there’s EU Deforestation Regulation, wherein, if the suppliers are failing to provide the necessary data, they will have to pay the penalty of 4% of the company’s annual EU-wide turnover.

So companies will have to provide data for the same which means setting up intermediaries to provide the same at large and on demand. And this practice can be highly costly.

Transparency: Demand of the consumers is also changing at a brisk pace. For example, now it is not just the price acting as a decisive factor but also accountability towards the environment.For example, as per reports, consumers are willing to pay a premium price as well if the product involved is manufactured using sustainable means. Which means, the product should have an infrastructure in place that can help verify its authenticity.

GeoPolitical Shifts: Geopolitical shifts is the next problem which can severely affect supply chains because during wars or other events, companies are looking for a better collaborative method to help circumvent the odds and trade at free will. In this regard, they need information dissemination in a scalable, secure and collaborative manner.

To solve all these problems, tokenization has ended up as a perfect solution for the supply chain segment because some of the players are extensively using the same to extract benefits from this like;

1. Walmart: Which has partnered with VeChain, IBM, DL Freight and Zero Cash to address problems like transparency, freight invoicing, and payments. Through the use of tokenization, Walmart was able to reduce wastage by 25% and integrate with more than 50+ ports in a paperless and scalable way.

2. Nestle and Pepsico: They are using tokenization to validate their sustainable contribution. So when customers sought for their contribution to protecting the environment, they provided verifiable proof using blockchain . As a result, they witnessed a significant jump in sales and profits;

In Energy

At the moment, out of 8 billion population worldwide, more than more than 730 million people are living without electricity despite majority of the areas claiming that they have been electrified because of the following challenges;

1. Access to Resources: There’s very limited financial resources available to streamline rural electrification. For example, in the sub- saharan region alone, the average investment required for complete electrification stands at around $55 B but the actual funding given is around $30 B. This is primarily happening because for the purpose of rural electrification, the need is to establish a gratification model wherein private players can participate and help in the process.

But often these processes are mired in controversies and complexities, alienating the private players to actively participate in it. And despite these odds, even if private players intend to participate, they have another barrier to cross like the cost of procuring the licensing and provisioning, which shouldn’t exceed 2%.

But in reality, they have to spend 10% or even more. And tariff regulations further exacerbate the situation which leads to their inability to recover even the basic cost. And even if they cross all the hurdles and still set-up the infrastructure, the last nail in the coffin is electricity thefts by users, which puts a bill of $16 on the head of the private power companies. Thereby, completely making their operations non motivating.

2. Energy Trading: Energy trading is another major barrier because there are many villages which are energy farming through natural ways like solar panels but they are not able to supply that electricity to the point of demand.

But this process is not that simple because they have to set up an expensive solution for the same like ground-mounted solar power plant, storage system, and rooftop photovoltaics. All of these are costly affairs and they demand funding. The need is to set-up a trading market where anyone that intends to participate can contribute to energy trading. And that’s where tokenization is solving the problem.

A prime example of how energy players are using tokenization to provide low cost electrification using blockchain as an underlying layer are:

(1) Schneider Electric: Schneider Electric and Arensis have joined hands to set-up a smart microgrid system. They are using the blockchain technology to

launch energy tokens which will be used to not just provide funding for setting up these grids and managing the same in a completely transparent, decentralized and scalable manner, but also act as a medium of exchange for supplying excessively produced electricity to low supply regions through these grids.

(2) Brooklyn Microgrid, a blockchain enabled community power hub is also using tokenization, where they are storing the excess power they generate in Lithium ion batteries and supplying the same to regions which are struggling due to lack of power.

If you are planning to build anything around tokenization, Zeeve can be your trusted partner.

If you want to claim your share from the vast ocean of tokenization across all sectors as evident from the chart below, you need a trusted partner.

Zeeve as a trusted, specialized enterprise grade blockchain infrastructure company can help you in all your pursuits. We provide every essence of support that you need from guidance to interaction and more. Want to disrupt the market and don’t know where to start from, talk to our experts and we shall help you in all possible ways.