KEY POINTS
- The Stradivarious violin was made in 1708 and is now owned by Animoca Brands co-founder Yat Siu
- Siu is said to be using the tokenized violin "as collateral" for a Galaxy Global Market business loan
- Galaxy's Michael Novogratz said the development will set the precedent for how RWAs are integrated into the digital economy
Blockchain firm Galaxy Digital has tokenized a Stradivarious violin valued at around $9 million, marking one of the most significant tokenization developments in the history of tokenized real-world assets (RWAs).
The violin is history in itself as it used to belong to Russia's Catherine the Great, as per a statement from the company. Made in 1708, the Stradivarious violin is now owned by Yat Siu, the co-founder of traditional and blockchain games publisher Animoca Brands. The statement said Siu is using the tokenized violin "as collateral for financing facilitated by Galaxy's Global Market business."
"The tokenization of this iconic musical instrument, celebrated for its unmatched craftsmanship and storied provenance, marks a significant advancement in the application of blockchain technology to unlock the value of unique real-world assets," Galaxy Digital said.
Galaxy Digital founder and CEO Michael Novogratz said the violin's tokenization is not only a way to preserve the instrument's legacy, but it also sets the precedent for how real-world assets can be utilized for "latent value."
"By starting with high-end assets like this violin, we're creating a process that will transform how a whole range of assets are managed, valued, and traded in the digital economy," he added.
Galaxy Digital isn't the only company betting on tokenization. There's also Realio Network, which is largely becoming a promising digital asset. However, Realio's core mission is to digitize private equity – placing various assets such as real estate into the blockchain.
Tokenization, which is not yet a very popular crypto subsector for retail investors in the industry, has started making waves in the digital assets space in recent months as more people dive into the possibilities within the vast blockchain space.
Venture partner and industry expert Alvin Foo believes tokenized RWAs are "the next biggest crypto trend" as tokenization allows investors "new chances to make their money more diverse" and gives them access to things they didn't think they could have accessed before blockchain emerged.
Let's talk about Real World Assets (#RWA), the next biggest crypto trend!
— Alvin Foo (@alvinfoo) April 26, 2024
1. RWA means taking real-world things and turning them into digital tokens.
2. Tokenization is when the rights to something, like a piece of property or a work of art, become a digital token on a special… pic.twitter.com/V0B5tWK7nK
In an exclusive interview with International Business Times last week, Alex Malkov, the co-founder of blockchain ecosystem HAQQ Network, said there is untapped value within tokenized RWAs. Compared to cryptocurrencies that are highly volatile, tokenized RWAs move within a more predictable and certain environment, which makes them the perfect investment choice for "risk-averse" investors.
