Tokenization, NFT & Fintech: what opportunities are there?

To understand how tokens,as well as NFTs which have become so popular today, can be useful to those operating in the fintech world, we spoke with Francesco Piras, Co-Founder of Brightnode.

What tokenization is and what it is used for?

Tokenization is the representation,in the form of a token, of a right, or physical or digital asset. The token is a sort of container that can hold, for example, a property right on a luxury good, a share in a company, or the fractional ownership of a property, etc. When only one token is used it is non-fungible and is an NFT. When several equivalent tokens are used, they are fungible and have the same exchange value.
The token is a computer code created and managed through blockchain technology. Tokenisation serves to manage assets, usually illiquid, more efficiently and with potentially greater liquidity. Furthermore, by using blockchain as the technical basis for management and transfer, the fragmentation and slowness of the traditional system is overcome thus sharing a common, secure, non-falsifiable infrastructure that is easily verifiable by all.

Why would it help attract investors?

Tokens on blockchain are a technical solution to the problem of having a common and shared infrastructure worldwide, in which there is less friction and the liquidity of the asset is potentially easier to obtain. These are important aspects for an investor, as is the possibility that the token will quickly appreciate in value and can be easily resold in the secondary market.
Managing your investment portfolio using a crypto wallet is undoubtedly simpler and more convenient than through paper certificates and fragmented procedures. The programmability of the tokens and the transparency of smart contracts allow you to receive returns and profits in an automatic and non-corruptible manner.

NFTs: what are they? We often hear about them for artwork and such, but what business opportunities can they represent for a fintech for example?

NFTs are non-fungible tokens, i.e. those that uniquely represent a specific physical or digital asset, or a right.
NFTs can be used in many areas. They have become popular in digital art and creativity, but have use cases in other contexts as well, due to their uniqueness and anti-counterfeiting properties. They can incorporate automated royalties, which can be useful for content creators.
In fintech they can be useful because they can, for example, represent a physical asset as collateral in decentralised finance transactions (DeFi). In general they can create a mechanism whereby financial products and services are represented by a unique token.

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TRAKTI: interview with Luigi Telesca

Trakti is a unified platform for smart, self-executing and compliant contracts running on both private and public blockchain, streamlining the contracting process of medium-large enterprises, financial, insurance and regulated market operators. Trakti offers all the tools needed to securely streamline the acquisition and negotiation flows, and manage all corporate contracts in a unique infrastructure. The objective of Trakti is to assist companies from the beginning right up to the signing and monitoring of the contract in a fully compliant way.

“Our solution was born from a research carried out over the years that has now ended with the release of the Trakti infrastructure that is able to support both traditional contracts and smart contracts, blockchain implementations – explains co-founder and CEO Luigi Telesca – in recent years we have focused mainly on increasing our recognition in the universe of B2B contracts“.

Recently, Trakti has been invited to a series of professional events within the communities of IACCM, the global contract management association, as a thought leader in contract automation and smart contracts. Trakti has also won the Innovate Finance 360 pitch competition in the Regtech category as an innovative startup offering an end-to-end solution in this industry. Last but not least, Trakti R&D lab won the EU Commission tender on modelling the European economy as an ecosystem of contracts.

Trakti operates on the English and Italian markets. It works with medium and large companies, supporting them in optimizing the management and facilitating the automation of their contracts. “Our goal is to explain why smart contracts will be a key element in the management of relationships and process automation,” Telesca explains. “We have also started working with the European Commission in Brussels to explain how smart contracts will become a catalyst for the next industrial revolution. On 30 September we are organizing a workshop on smart contract ecosystems and their impact on GDP”.

As a platform that combines multi aspects of Fintech, Regtech and Lawtech, Trakti needs to have connections with both corporate and of startups worlds to find new business opportunities. This is why it joined Fintech District, looking for a catalyst that could put us in touch with these different stakeholders. Thanks to Fintech District we have been in contact with different entities and we think we can use all these networks of connections to carry on our growth process and facilitate the successful implementation of our strategy.

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Distribute mutual funds through the blockchain. Gimme5’s Word!

A come A will distribute mutual funds in Italy through the blockchain. This feature has been tested on Gimme5, the company’s app to invest and save starting from 5 euros; the first saving app interested in exploiting the blockchain.

Thanks to this new feature, Gimme5 will be able to carry out subscription and redemption transactions of mutual fund units and related payments in real time using smart contracts based on the blockchain.

AcomeA carried out the test through Fundsquare’s FundsDLT platform, based on blockchain technology, and through Fabrick‘s Open Banking platform. The positive result obtained shows that it is possible to simplify as much as possible the execution of transactions and that the blockchain is able to bring efficiency and cost-effectiveness in the processing of orders on investment funds.

To find out more, we interviewed the real protagonists of this project, two members of the Gimme5 team who work behind the scenes and are not often asked about the results achieved: the Lead Developer and the Gimme5 Data Manager. Fabio Arlati and Giuseppe Codazzi, tell us about this historic result and the first subscription of mutual fund shares in Italy through blockchain technology.

What exactly is the test you carried out?

The test consisted of the reception, valorization and registration of transactions for the purchase of fund shares exploiting the potential of FundsDLT and Fabrick. This allowed Gimme5 to test a cheaper, faster, more efficient, and, thanks to the very nature of Smart Contracts, certified process.

What does it mean for the fintech sector?

Apart from the obvious technological and innovation aspects, the most important achievement is the collaboration with Fundsquare and Fabrick. With the success obtained, we have demonstrated that fintech can be a concrete sector with strong cooperation between the parties, benefitting the industry itself and its customers.

In Italy, our test it is the first one, but in Europe, several European groups operating in the asset management sector have already conducted similar experiments with FundsDLT; however, it is the first time in Europe that more players in the fintech panorama have been involved.

What benefits will it bring to users?

As this is the first test, the timing of approval and change will be long because it is necessary to innovate also in terms of process management. The first advantage will certainly be the level of usability of the service. The user will be able to enjoy an alternative and more efficient purchase method, which can be completed in a shorter time period. Furthermore, there is the argument of costs: Gimme5 has already cancelled or reduced all costs to a minimum, including operational costs. This lighter infrastructure will further increase the benefits for our customers.

How will your business change after this result?

Undoubtedly, the use of such a model can guarantee Gimme5 to exploit an increasingly efficient infrastructure, both in terms of process management, times, and costs. Moreover, the fact that all three players involved want to be platforms speaks volumes in terms of future objectives. Gimme5 has always been in favour of opening up to new partners and also to new markets: we have international aspirations.

What were the strengths of the collaboration with the other two platforms? And the most critical aspects?

The strengths are certainly linked to cooperation. Each one of us brings the best to the entire supply chain, making the process more efficient in all the aspects. In fintech, there is a real opportunity to work as a team and I believe that this has already been an excellent starting point.

There were no particularly delicate moments. Of course, there was a lot of attention for the timing. In projects of this kind, with three players involved, each one rightly had its own objectives and priorities. It all started almost a year ago, we have come a long way since then and will certainly continue to do so.

Are you looking for any information about Gimme5? Read the interview with product manager Flavio Talarico

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