What Are Tokenized Securities?

Tokenization essentially refers to the digitization of the legal rights or ownership rights to an asset on a blockchain network. If we follow similar logic,  a tokenized security would be  the process of establishing financial rights in a security through the issuance of tokens on a blockchain platform. Tokenized securities on a blockchain may potentially represent a share or financial rights of any individual in any particular asset, the rights to receive certain benefits from the asset, or the rights to receive the proceeds if or when the asset is sold. Stocks, bonds, equities, or investor shares, contractual rights in commercial contracts, insurance premiums and many other assets can be tokenized. One of the main benefits of tokenized securities is that they enable access to assets that have been typically illiquid.