All About Digital Assets

The phrases ‘cryptocurrency’ and ‘non-fungible token (NFTs)’ have grown in popularity over the last several years as they have become more widely adopted and used for a variety of purposes. While cryptocurrencies and NFTs may represent different types of investable assets, both areas can be considered ‘digital assets’. As more people become aware of digital assets and begin investing in them, it is important to understand what these assets are, why they are important, and how blockchain technology is helping to grow this area.

In its most basic definition, digital assets can be defined as anything that exists in a digital format. The phrase ‘digital assets’ has historically referred to media formats that were traditionally physical items, such as photos, videos, and documents, that began to being created, stored, and shared in a digital environment.

However, since the emergence of blockchain technology, the term ‘digital assets’ has expanded to include investable asset types such as cryptocurrencies, NFTs, asset-backed tokens, and tokenized real estate. As these new blockchain-backed digital assets have become more widely adopted, the definition of the phrase has shifted to being primarily focused on assets that are backed by a distributed ledger, rather than digital media files. Many physical assets, such as real estate and commodities, can be tokenized and create a digital asset for trading, opening up new possibilities for digital assets marketplaces.

The emergence of investable digital assets within the financial services industry represents a new opportunity for investment in a fast-growing area backed by a technology that can be scaled to digitally transform businesses and assets.