Domain Tokenization, in the IT industry, refers to the shareable mode of ownership of one domain of a particular website. In this way, one domain is being shared by as many people as you like, and the incentive for spreading the word about the website is shared by all the respective partners.
To understand the concept of domain tokenization, take the example of poker chips. You get a lot of chips of different colors with which your wealth in the game is calculated, and the winner is chosen at last. Each token, however useless it may seem to a common person, represents a value that you carry in mind and play the game. For instance, the white poker chip represents one dollar, the red chip represents five dollars, the blue chip represents ten dollars, the green chip represents 25 dollars, and the black chip represents a hundred dollars.
In the same way, the token you get in exchange for your money holds no real value but instead represents a much bigger value. In this way, the token is considered significant because you get what they represent when you exchange these tokens. This process is called domain trading.
Tokenization, as the name suggests, is the process of converting any valuable asset, such as money, gold, identity number, content, and other essential belongings, into a token. It is estimated that the domain tokenization industry is expected to grow from 2.3 billion dollars in the last year to 5.6 billion dollars in the year 2026. (Source: marketsandmarkets.com)
In the year 2021, North America was ranked at the highest level for having the largest tokenization market. The reason tokenization is used so vastly in today’s world is that it offers the buyer as well as the seller a very safe and secure mode of transaction. It allows for a hassle-free transfer of ownership without having to carry a bag full of cash or undergo humongous bank transactions. (Source: statistics.com)
Cloud name is one of those prominent platforms that has gained popularity in the past decade. Using Web 3.0 (internet of the third generation that relies on the concept of blockchain and token economy), this platform allows for quick and efficient transfer and acquisition of assets through non-fungible tokens.
Tokenization is now being used on a broad scale by banks, companies, and government institutions, where there is a chance of information theft or misuse of essential assets. Thanks to the process of tokenization, meaningful assets such as card numbers, security data, or medical records can be preserved without being vulnerable to theft or misuse.