What is the Asset Backed Token Handled at CROSS exchange?
Do you what asset backed tokens are in cryptocurrency? Since CROSS exchange is to establish a professional market of asset backed tokens, this article will explain about asset backed tokens and token listing conditions for CROSS exchange.
What is an asset backed token
An asset backed token is a pegged currency whose value is actually secured by the existing asset. There may be people who have heard of securities, ABS (Asset backed securities) and asset-backed securities are a similar structure. With the ABS structure, a company transfers an asset located in a Special Purpose Company (SPC) and the SPC issues securities with the asset as collateral. In the domestic market (Japan), trusts are allocated instead of special purpose companies; it is issued as a trust beneficiary for use rights. For asset back tokens, blockchains play an intermediary role in place of SPCs or trusts with their issued asset-backed currencies.
Advantages of asset backed tokens
As an advantage of the asset back token, price stability can be mentioned first. With cryptocurrency, I think there is a case that the volatility is large and the stability is low, but the reason why this volatility has occurred is that the transaction is done without anyone knowing the reasonable price for the token as it has no underpinning.
As asset backed tokens are backed by real assets, it is possible to aim for tokens that are easy to understand at reasonable prices, stable in price, and easy to use as currencies. Next, there are uses as a hedge currency as an advantage reflecting the stability of the above price. By moving assets placed in currencies with high volatility to asset back tokens, it is thought that losses due to price fluctuations can be limited.
Furthermore, improvements in efficiency of existing markets are expected. In existing markets, there are many things in which the transparency and liquidity of the assets themselves are not guaranteed, and standardization of prices is maintained. By registering these assets on the blockchain and linking them with asset backed tokens, it is expected that transparency and circulation will be secured and machine learning will make it possible to standardize prices according to quality.
Diamonds are one of the representative assets that are expected to make such improvements.
Diamonds have the problem where actual production is not clear, circulation is not stable, and the standardization of prices cannot be maintained because each ore is different from one another. Also, diamonds that are mined in battle areas are so-called “conflict diamonds” and sold for war funding are in circulation, which is a problem. By registering diamonds on the blockchain and linking them with tokens, this kind of problem is solved, and companies can also benefit from proof of the ore supply chain they deal with.
Thus, asset backed tokens have advantages for both investors and consumers.
CROSS exchange’s asset backed token special market
CROSS exchange has decided to establish a professional market for asset backed tokens. It is the first time in the world to open a professional market for asset backed tokens on an exchange, and they are actively seeking to list excellent projects.
Listing Conditions and Application Method
CROSS exchange lists the following as conditions required for a listing project:
* Have technology and development capability
* Have a community
* Information transmission is transparent and fair
* Project is progressing consistently
* There is a profit structure as a real business
* There is either a patent or a special capability, etc.
* The project did not raise funds more than necessary
* It complies with the laws of the issuing country
If the project meets the above conditions, you can apply from the application page here and after passing examination you can be listed on CROSS exchange.
After getting listed, it is safer as an investor to wait for CROSS exchange to create a wallet and perform a security check of the token and before starting to trade that token. As CROSS exchange aims to be an exchange to be used worldwide from now on, will it not be a suitable place as a first step in securing distribution channels for asset backed tokens?
As described above, the asset backed token is a token with its value as a real asset with many advantages such as price stability, using it as a hedge, improvement in efficiency of existing markets and so on. Since the asset backed token itself has been on an increasing trend in recent years and attention has gathered, it is expected that the special exchange market on CROSS exchange will accompany it as well.