Adena Friedman runs an exchange worth hundreds of billions of dollars. She just realized money can be locked up in illiquid assets. Revolutionary stuff.
Tokenization is the process of turning real-world assets into digital tokens on a blockchain. Friedman believes this will "unleash" tens of billions in trapped capital. Trapped is doing heavy lifting here. The capital isn't trapped. It's just owned by people who can't find a buyer at the price they want. That's called having a sh*tty asset.
The pitch goes like this: Take something nobody wants to buy. Chop it into a million digital pieces. Suddenly everyone wants to buy it. This is the same logic that brought us fractional shares of GameStop, which worked out great for everyone involved.
Friedman didn't specify which tens of billions she meant. Could be real estate. Could be fine art. Could be the market value of every Bored Ape NFT if you squint hard enough and lie to yourself. The beauty of tokenization is you can tokenize anything. A Picasso. A condo in Miami. Your cousin Derek's DUI settlement. All equally liquid once you slap them on a blockchain.
Retail traders will love this. They've spent years trying to figure out how to lose money in stocks and crypto. Now they can lose money in tokenized commercial real estate they don't understand in cities they've never visited. Diversification.
The word "unleash" is perfect. Suggests something powerful being set free. A lion. A hurricane. Tens of billions of dollars that were definitely going to make you rich if only someone had invented the technology to turn a strip mall in Tucson into an ERC-20 token.
Nasdaq wants to be the exchange for tokenized everything. Makes sense. They already host companies with no revenue. Why not assets with no buyers?
Photo by Pascal Bernardon on Unsplash
Leave a Comment