What started off as a means to buy and sell expensive digital artworks has now turned into a legit means for businesses to enhance their operations. This article is about NFTs, which are revealing its immense potential, and are proving beneficial in the finance sector.
Let’s take a closer look at the various ways in which the capitalization of NFTs is bringing innovations in the financial services industry.
Mutual funds to NFT bundle conversions
It is now possible for financial companies to convert mutual funds into NFT bundles.
Each NFT will be assigned a portion of the fund. It is helpful in the following ways.
- It makes it simple for investors to buy, trade and sell their shares with minimal hassle.
- The move enhances overall transparency among investors, especially in making the performance of each asset traceable and verifiable. There is also higher accessibility ensured in this manner.
Tokenized asset management
With the help of NFTs, banks can now tokenize account numbers and manage them digitally. The account descriptions and other features can be stored as metadata.
This activity has several benefits, such as the following:
- It makes it easier to onboard new clients, enhance customer relationships and experiences, and reduce the possibility of fraudulent activities.
- Clients are given unique digital identities that are easy to authenticate, and provides them access to various financial services and goods.
Royalty tracking and distribution
Royalties are easy to track and manage through the NFT framework. For example, a digital artist can manually select the royalty they wish to receive while creating their NFT content. The royalty information is safely stored as part of the blockchain system. The finer details and terms of the royalty is added to a smart contract. The royalties are generated automatically when sales happen. Financial service companies can ease such processes for their clients using traceable NFTs.
Digital asset custody and management
With the help of NFTs, banks can enable custody services for various digital assets,. It includes cryptocurrencies, digital artworks, and more. Listed below are the key advantages of doing so:
- There is an enhanced level of transparency and security in such operations through the help of NFTs.
- All the ownership details are immutably recorded in the blockchain ledger, making it fraud and tamper-proof.
Tokenized physical and digital assets
By using NFTs, banks can enable various tokenization services. The service is available for assets like physical land deeds and intellectual property. It helps in the following ways:
- By assigning NFTs to provide proof of asset ownership, it is easier for banks to offer clients liquid and similar assets which are easy to trade. They can be quickly authenticated through the blockchain system.
- The system greatly benefits customers who face difficulty in monetizing their assets.
Bottom line – Authlink is testing the waters in the financial services industry
Authlink offers a range of NFT-based solutions that can aid financial service companies in numerous ways. The solutions promote transparency in the financial sector, and easen operations for banks to attract and retain customers. Furthermore, there is a higher level of traceability and accessibility ensured for clients in the financial services industry.
All in all, the financial services industry has a lot to gain from the introduction of NFTs. Explore the best NFT services for financial service companies today. Schedule a demo of the Authlink platform or sign up for the beta version.