Tokenization
Contextual Quote
Amir Taaki:
"The free software movement possessed world class developers with a community of strong believers. But the movement simply lacked resources due to there being no economic model.
Through the power of tokenization, we now have an alternative. Programmable money enables a rich set of techniques to develop economic networks.
Token engineering and DAOs are shattering the basic structure of the old world. The old world is corporate, hierarchical, and rigid. This new world is rich, intense and creative.
In the classical corporate model, you have a consumer-producer dichotomy. This distinction does not exist in crypto. The focus is on community and squad wealth. Rather than a company exploiting users for profit and protecting their property, the owners and producers are the community themselves.
The value of a project is directly proportional to its community. Tokens capture the value generated by a community and circle that value back to the community itself. The ability of projects to foster participation, enthusiasm and engagement is therefore crucial. Communities foster autonomy through discourse, negotiation and narrative. This in turn leads to democratic transformations of the individual, fashioning them for the values of self-governance and self-development.
Nowhere is this social evolution more apparent than in DAOs. DAOs are a new governance primitive that enable latent democratic forces to assemble and organize themselves before power and capital forces can narrow them ideologically. This enables the exploration of unrealized liberation zones. The users are stakeholders that can participate directly in governance decisions. They can decide on development targets, features, salaries, capital allocation and investments.
The ideal of politics is to multiply public spaces. Crypto is therefore deeply political. Politics concerns taking decisions regarding the collective interests of society such as well-being, security and freedom. In this sense politics and direct democracy are synonymous.
The old model of technology is anti-political because it removes ownership from people and places it into the hands of monopoly. The old model encourages passivity and indifference by design, reducing people to consumers. This is essentially the orientation of modern technology. Its arc extends back 5000 years to the origin of civilization itself."
(https://lists.dyne.org/lurker/message/20211021.123016.3dccaf0c.en.html)
Description
From Coin Telegraph:
"Tokenization is the process of turning things into digital assets.
Assume you have a farm that is worth $1 million. It has a big barn, cows, rabbits, a hedgehog — you name it. All of a sudden, you are desperately in need of money, you can sell that farm the old way — fill out the paperwork, wait for an offer, close the deal, etc. But what if you need less than $1 million and would prefer to keep most of the farm to yourself?
Imagine digitally printing 1 million tokens under the symbol “COW,” for instance, where each COW is worth exactly 1% of your property — or any other amount, just as long as each token represents a certain share of the underlying asset (in this case, your farm).
Technically speaking, you would be developing an algorithm that would be implemented as a smart contract on a blockchain. This algorithm defines all the features of your future token: its value, quantity, denominations, name, etc.
So, how do we actually get those COW tokens out there so that they can be freely bought and sold on different exchanges? For that, we need a platform that supports smart contracts. Ethereum would be the most popular choice. Rather than getting into the technical details about how tokens are created and getting too far off topic, let’s just say you’ll need a smart contract template, a text editor and an Ethereum wallet address.
Voila, COW tokens are now in circulation! Technically, they are ERC-20 tokens — basically meaning that they are powered by Ethereum blockchain. Now that they have entered the market, their value can either go up or down in accordance with demand.
See how blockchain can allow us to tokenize things now? We took a farm and created its digital representation that exists on a blockchain. In short, this farm is now a tokenized asset." (https://cointelegraph.com/explained/tokenization-explained)