If you’re new to crypto, you’re probably just getting started when it comes to learning about the blockchain (the technology behind it) and the concept of tokenization. It doesn’t matter how many years young you are, being able to understand emerging technology trends and what it means to your life is important.

That’s why we’ve assembled this helpful guide for seniors wanting to understand tokenization.

The world is constantly evolving, and many senior investors are starting to realize that technologies like the blockchain and digital currencies like Bitcoin aren’t just a fad – they’re become an important part of the modern, global economy. A boomer who may have dismissed Bitcoin years ago, when it was worth $3,000, might now realize they lost out on an incredible opportunity as Bitcoin breaks all-time highs. Many seniors now realize that they may have been missing out on the investment of a lifetime.

Before we dig into tokenization concepts, let’s clear the air here:

While you may read articles on digital currencies that mention tokenization, in this article today, we aren’t discussing actual cryptocurrencies in this guide, as much as we’re focusing on the actual concept of tokenization. What does the word REALLY mean? What is it? How will it affect the future, and how can it improve the way assets are exchanged and traded?

#1 Tokenization is more than just NFTs

During 2021, there was a massive NFT craze, and billions of dollars flowed into non-fungible tokens. There are countless artists, influencers, and entrepreneurs who helped to propel NFTs to new heights. Cooper Turley, a crypto millionaire, has been a significant figure in this space.

The one issue is that countless people worldwide often associate tokenization just with the concept of an NFT. This would be a narrow way of thinking about technology since an asset-backed token can be much more than just that. The technology can be used to democratize investments in a way that has never been possible before.

Let’s be honest: as a boomer, you may not be at a place in your life where you’re interested in how NFTs can transform the video game industry. You probably don’t want to buy art from a teenager that somehow sold for an obscene amount of Ethereum, either. However, there’s so much more that tokenization has to offer.

Ultimately, tokenization works in this way: digital tokens can now represent real-world assets, offering proof of ownership. The technology also provides enhanced liquidity, security, and transparency.

#2 tokenization can be used for fractional ownership

Okay, so you think the concept is interesting, but you’d rather learn more about cryptocurrency trading or what crypto will explode next. We understand, but there’s more than meets the eye.

front of two story modern house at duskThe boomer generation is used to ownership being designated on paper—like a house where a paper deed signifies that a person is the true owner of that home. With blockchain technology and tokenization, there are actual houses that can be converted into digital tokens.

There are more possibilities here than you might realize. First, there is a much lower barrier to entry. Let’s say that you are interested in a property, and feel like it is very much undervalued. Even if a one cannot afford to purchase expensive real estate, a company like Spydra can help buyers own a fraction of a property through tokenization and smart contracts.

As we mentioned before, tokenizing assets is much bigger than NFTs. While the legacy world is busy using brokers and intermediaries to sell their assets, individuals can now exchange real estate on the blockchain, without the extra transaction costs. This means that you can get fractional ownership of a home, car, boat, or another real-world asset…all on the blockchain. While the concept of tokenized real estate might be new, the trend is picking up steam.

#3 Tokenization can be used to buy asset-backed gold tokens

If there’s one way to summarize what this technology can do, it’s that it can democratize investments in a new way. A boomer might not want to throw their life savings at a cryptocurrency, but they might want more autonomy over their finances now that there are immense crypto market opportunities. Some boomers may be looking to make some smart investments in the aftermath of the pandemic.

senior looking at stocks in newspaperYears ago, many people had no idea where to go if they wanted to buy Bitcoin. These days, it’s easier than ever for someone to figure it out. Gold has been a popular investment since it can work as an excellent hedge against inflation and a “safe haven” when the market goes south. Instead of buying physical gold, tokenization allows investors to buy an asset-backed token representing gold for more liquidity, faster transaction times, and fewer fees. What’s not to love?

What does the future hold for tokenization?

The media often depicts a boomer as someone who has made loads of money in their career and is more focused on retiring than embracing new technologies. However, as you embrace a new phase of life, consider that tokenization can offer new opportunities and even change the way the world thinks about asset ownership.

While the technology is incredible, it is unclear exactly how governments and agencies worldwide will treat and regulate these assets, but between the Fed and major banks – and even Mastercard – embracing blockchain and cryptocurrencies, it’s clear that it’s here to stay. 

How much will tokenization help to democratize investments, and what industries will it affect the most? Only time will tell.

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Michael Hearne

Michael Hearne is the CEO of Decentral Publishing and the host of the Uncensored Crypto docuseries.