Dark Mode
Image
Saturday, 28 January 2023
Andreas Veneris, CTO at world renowned digital asset firm exchanges, explains the fast-moving digital assets space and how they are related to blockchain technology.

Andreas Veneris, CTO at world renowned digital asset firm exchanges, explains the fast-moving digital assets space and how they are related to blockchain technology.

2022-10-29

 

Digital assets have been with us for a while, but the space has only recently experienced a major boom. It’s possible that the timing couldn’t be better for blockchain-based digital assets. With the increasing visibility of digital assets, the market for tracking, verifying, and trading them is also growing. In this blog post, you’ll learn about digital assets, the blockchain technology that underpins them, and the key considerations when developing digital asset platforms. You’ll also get an overview of the players, technology, and projects in the space so you can make up your own mind about whether digital assets are the right asset class for you.

What are Digital Assets?

“Digital assets” may refer to any kind of data that’s stored on a blockchain and/or the smart contract that’s attached to it. They could be market data, financial data, content, or any other kind of data that’s stored on a blockchain and/or the smart contract that’s attached to it. You might have heard of digital assets such as cryptocurrency or blockchain-based tokens. These are digital assets, though they’re not necessarily linked to a specific blockchain.

Their Role in the Blockchain World

Most people are familiar with blockchain technology as the technology that’s behind cryptocurrencies like Bitcoin. But blockchain is more than just bitcoin — it’s a technology with many other uses. For example, the Ethereum blockchain is used to track assets like stocks and bonds, as well as cryptocurrencies like Ether.

How Digital Assets Are Trackable

When you purchase something like stock in a company, the transaction is recorded in a public blockchain. Everyone who wants to trade that stock can simply buy it on the blockchain and then sell it to someone else. The transaction is verified and recorded in the public ledger, which makes it traceable. In the same way, when you sell something like stock or property, the transaction is recorded in a public blockchain. Each party involved gets a copy of the blockchain, which makes the transaction traceable.

How to Track Digital Assets on the Blockchain

There are a few ways to track digital assets on the blockchain. The most common method is via an API. You can use an API to track assets, such as the shares you purchased or the property you sold, across multiple blockchains. The API can also track other types of data, like the API can track the weather from your computer to your smartphone, letting you know current conditions and forecasts.

 
 
 

Advantages of Tracking Digital Assets on the Blockchain

The advantages of tracking digital assets on the blockchain are many, and they all have to do with increased transparency and security. With blockchain-based tracking, you don’t have to keep track of paper trails or manually enter data into spreadsheets. Your team can focus on developing the business logic and building the applications instead.

You also get to benefit from the new-found security of a blockchain. Each transaction on the blockchain is verified by a network of computers that are all part of the same public ledger. If one of the computers in the network is hacked, the entire network is affected — not just the hacked computers.

Disadvantages of Tracking Digital Assets on the Blockchain

On the surface, the disadvantages of tracking digital assets on the blockchain sound like they cancel each other out, since you get all the benefits of blockchain technology and the added assurance of a verified system. That is, until you look a little closer. The first disadvantage of tracking digital assets on the blockchain is that there is no way to mark assets as sold or bought without diving into the blockchain. If someone hacks the network and steals your share, you’ll never be able to track it down and return it. The second disadvantage is that the technology isn’t available in every market. In the United States, you can currently only trace digital assets to the last known location. No other country has caught up, meaning that you won’t be able to track digital assets across borders.

Conclusion

Digital assets have been with us for a while, but the space has only recently experienced a major boom. They’re an ideal technology for tracking and verifying products, services, and transactions across multiple blockchain and distributed ledger networks, such as the one behind cryptocurrencies.

With the increasing visibility of digital assets, the market for tracking, verifying, and trading them is also growing. In this blog post, you’ve learned about digital assets, the blockchain technology that underpins them, and the key considerations when developing digital asset platforms. You’ve also gotten an overview of the players, technology, and projects in the space so you can make up your own mind about whether digital assets are the right asset class for you.

Comment / Reply From