Q. Which of the following statements about Real-World Assets (RWA) Tokenization are correct?
1. Tokenization is the process of turning real world assets into digital tokens using blockchain technology.
2. Tokenization of real world assets offers 24×7 access, promoting financial inclusion.
3. Tokenization of real world assets will allow the access to high growth investment opportunities for individuals in India.
Select the answer using the code given below :
Exp) Option a is the correct answer.
Statement 1 is correct. Tokenization refers to the process of converting ownership rights of real-world assets such as real estate, commodities, bonds, artwork and financial instruments into digital tokens on a blockchain network. These digital tokens represent fractional ownership of the underlying asset and can be securely traded or transferred through blockchain technology.
Statement 2 is correct. Tokenization also enables 24×7 market access because blockchain-based platforms operate continuously without the limitations of traditional market timings. It allows investors from different regions and economic backgrounds to participate in investment markets with lower entry barriers through fractional ownership. This expands financial participation and promotes financial inclusion.
Statement 3 is correct. RWA tokenization can provide Indian investors access to high-growth investment opportunities that were traditionally available only to institutional investors or high-net-worth individuals. Through fractional ownership, individuals can invest in assets such as commercial real estate, global securities, artwork and other alternative assets with smaller amounts of capital.
Source:) https://www.npci.org.in/blog/understanding-asset-tokenization-to-unlock-digital-asset-potential
https://digitalfinance.worldbank.org/topics/competition/tokenization
