The digital asset revolution marks a new phase in the ongoing digital transformation of the financial services industry. And it’s a phase that’s only just begun.
Focusing on the secure and reliable transmission of data and information, the digital asset industry is set to become a dominant force within the financial services sector over the coming years. The result? A whole new world of possibilities for individuals and financial institutions.
Here’s everything you need to know about the digital asset revolution.
What Is A Digital Asset?
A digital asset is any asset that exists only as data. These assets can take many forms, ranging from financial instruments like stocks and bonds to cryptocurrencies.
Digital assets can be split into two broad categories:
- Non-interchangeable assets
- Interchangeable assets
Non-interchangeable assets cannot be exchanged for other digital assets. Examples include cryptocurrencies like Bitcoin and Ether. That is, “digital cash”.
Interchangeable assets can be exchanged for other digital assets, and they have the potential to revolutionize the way that financial institutions operate in the future.
Emerald NFTs (non-fungible tokens) is one example of an interchangeable asset on the Blockchain Nodes. Each NFT is unique and cannot be exchanged for another asset – it’s essentially its own “thing”.
These tokens can be used to represent any type of physical or virtual asset – from a cryptocurrency to real estate property or even artwork.
NFTs provide proof of ownership for these types of assets, and they can be transferred from one owner to another in exchange for cryptocurrency. This makes them an ideal choice for a wide range of applications such as:
- Identity management, to prove ownership of digital identity data and to share sensitive information safely and securely.
- To represent digital items in video games and other virtual worlds
- They also allow collectors to prove that their collection is unique
- For trading financial instruments and to protect investors from fraud
How Do You Trade Digital Assets?
The most popular way to trade digital assets is by using a cryptocurrency exchange. Transactions are instantaneous, and trades can be made 24 hours a day, 365 days a year. At the moment, there are over 240 cryptocurrency exchanges in operation with more launching every month.
There are also ways to buy or sell digital assets via an online marketplace or over the counter (OTC) on the open market.
How Do You Store Digital Assets?
Digital assets are stored in various ways. Some digital assets, like cryptocurrencies, exist as data on the blockchain. Other digital assets, such as video files, are stored locally on a personal computer or media player.
But then there are other digital assets that exist only in electronic form and never “touch” any physical medium—these are known as “digital intangible assets”.
Whatever form a digital asset exists in, it is important to know how it can be stored and where to find it.
The Future Of The Digital Asset Ecosystem
As blockchain technology improves, more and more businesses will adopt it. In turn, this will lead to an increase in the demand for digital assets. Emerging sectors in the digital asset economy include:
- Financial services (e.g., blockchain, blockchain-based networks, and digital asset trading platforms and exchanges)
- Technology (e.g., supply chain management, data storage, and cloud computing)
- Health care (e.g., medical records)
- Governments and public sector organizations (e.g., tracking disaster relief funds)
- Media, entertainment & social media (e.g., streaming rights)
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