Tokenization and its benefits
Blockchain solutions are a ground-breaking force in the financial sector. To begin with, they allow money to be sent around the world in several minutes at a fraction of the traditional cost. Afterwards, it became feasible to conveniently raise capital through Initial Coin Offerings (ICOs). Currently, a new blockchain solution, tokenization, is allowing the wider audience access to investments previously limited to large funds.
Tokenization is nothing more than converting ordinary assets into digital tokens on the blockchain. It enables those tokens to enjoy the benefits provided by digital ledgers. Below, we will describe in greater detail why this concept is such a game-changer in the world of finance and how Lucrosus Capital — the first Decentralized Venture Capital (DeVC) — takes maximum advantage of tokenization.
Providing each individual investor institutional opportunities
One of the advantages of blockchain is the ability to divide any asset into an unrestricted number of digital shares, each of which is represented by a separate token. This makes it possible to add liquidity to the market, where it was simply impossible before. Real estate is a good example of this phenomenon. In the traditional market, if you want to make money renting out apartments, you have to buy them out in their entirety. Of course, it requires a very high amount of financial commitment and automatically leads to the existence of a high entry threshold, where only the richest investors can succeed.
This case is similar for venture capital funds. Traditional funds have very high financial thresholds for investors to join and participate in their profits. Moreover, because such funds manage large sums of capital, they can afford to support promising projects in the early stages of development and thus can receive very favourable investment terms. These benefits are impossible for individual investors. This is where tokenization and DeVC come through and proliferate services, which previously were restricted for the few.
Lucrosus Capital, through the usage of tokens, can create utilities that are unprecedented in traditional markets. Among such applications is the possibility for investors to participate in the allocation in promising projects made by Lucrosus Capital. Holding tokens (in the case of Lucrosus Capital it is $LUCA) allows taking part in such an investment in proportion to the number of owned tokens. It should be emphasized again that the funds make such allocations on very favourable terms, so the use of tokens enables individual investors institutional benefits.
Safety in various forms
Contrary to conventional databases, data stored in a blockchain can’t be altered — any bribe won’t change it and it is almost impossible to be hacked. This is one of the best characteristics of blockchain technology.
With tokenization, immutability is important because it allows you to track the history of your tokens: who created them and when; who sold them to whom, when and at what price. This way, investors can never fear that their investments will be lost to fraud, theft, systemic errors, or corruption — tokens can always be tracked and returned to their true owner.
Furthermore, the data on the blockchain is cryptographically protected so that sensitive information can be stored on open databases and still be secure. This means that anyone can download a database that contains information about tokens and market participants, but only people with a specific key can access crucial information.
Additionally, security is guaranteed by a distributed ledger, which means that the information on the blockchain is simultaneously stored on multiple devices. Making changes, like new transactions, is possible only with the consent of the majority of system participants, so there is no possibility of hacking.
Time to make a significant impact by yourself
Tokens can also reflect the voice of investors. This allows DeVCs such as Lucrosus Capital to engage their community to get involved. This allows investors to have a real impact on the company’s operations and support development. At Lucrosus Capital token holders can decide about the timing of buybacks, AMAs with the projects’ representatives and many other activities. It allows not only for real influence on DeVC activity, but what’s more essential, governing creates a strong bond with all of our supporters. It assures commitment to the Lucrosus performance and motivates the team to provide as many prosperous opportunities as possible. In this way, Lucrosus Capital and its investors drive each other. The two parties can only benefit from this as they share the same goals.
Why does it affect you?
Whether you’re a novice investor or a blockchain fanatic, it’s crucial to understand and consider tokenized investment through decentralized venture capital because it’s already happening. It is here, and the landscape will soon look different. Tokenization is creating a more efficient, democratic and vast financial environment.
Venture Capital investments are on the verge of being accessible to a wider range of investors. With DeVC breaking through the bureaucratic and previously only available to the wealthiest investments in affordable tokens, the only question that remains is: where do you stand?
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