Whilst watching a forty-minute podcast in which the owner of an entrepreneurial business was offering tokens it caught my interest to see how genuine the business proposal could be.
Tokenization is really no different to cryptocurrency or the more well-known Bitcoin digital scheme that exchanges real money for online tokens that assumedly can be transferred digitally from one account to another either in close proximity or in any country around the world. However, from what the guest who owns Blockbr said, and from my interpretation which isn’t perfect, but from what I understood the money punters who are prepared to invest in this token facility get 2% return on a monthly basis.
From my understanding business owners, large financial investor clients would be handing over company money, often in limbo to receive tokens in exchange. Then Blockbr would pay out 2% interest per month (not sure how he can guarantee it). They are not buying shares which is different to Bitcoin and other cryptocurrency investors, but rather they are purchasing digital assets that are invested into profitable Return On Investment (ROI) in businesses and commodities.
In other words, Blockbr has the client’s money which they would invest; that functions the same as real money. To my simplistic mind it is the same procedure in that money is tied up and subject to investment strategies to make profits. I personally, do not see how Blockbr can say the investor gets 2% a month unless he is simply returning 2% of the investment in the first place. 24% gains per year seems surreal.
According to one Brazilian website called Mercado Bitcoin, tokenizing is the act of fragmenting an asset into small digital fractions using the blockchain database. This transformation, known as tokenization, gives rise to a token, which is a digital representation of a certain asset, be it money, a right or a property.
By creating small fractions of the asset, it becomes possible to trade it in a practical, safe and more democratic way. The best of everything? Any asset can be tokenized, including music royalties, carbon credits, loyalty programs, artwork and even investments. Sounds like NFTs.
Corinthians apparently have their own digitalized token. According to my understanding, if you buy Corinthians Fan Tokens and be part of the bunch of fanatical people you can also participate in club decisions. Corinthians is a Brazilian football club from the city of São Paulo. It was founded on September in 1910. Known as “Fiel”, its fan base is one of the largest in the world. Currently, Mercado Bitcoin is the team's official sponsor.
Fan clubs’ tokenization for customers is one thing, however, see graph below which begs the question of how safe is it to exchange real money for tokens. It certainly oscillates! So, you might ask, does it make sense to go down this alley? If tokens maintain the same purchase power or better then it makes sense. (UK’s Manchester City Fan Token)
However, if there are potential gains, as well there are possible loses. If we study the graph below it is clear to see that the value has reduced considerably since its original value. If real money doesn’t fluctuate so much then why take the risk. Alright, you could be lucky, but come on it could be a wild goose chase.
Now I like this Corinthians token scheme for fans because they guarantee funds for matches, and other merchandising. I seem to recall they are able to cash out, but even if they can, true fans won’t, as they are steadfast to who they support. I’ve never heard of fans bouncing from one club to another although in some cases it probably happens.
I’ll leave you to make you own judgment call on the validity as I cannot recommend buying tokens in any form. When the word token is mentioned, Monopoly comes to mind, and I haven’t played that game since childhood.
Take care!
Prof. Carl Boniface
The Blockbr interview in Portuguese:
Vocabulary meaning:
In limbo (adv) = in a state of uncertainty, on hold, waiting on events, on ice, on the back burner. In an uncertain or undecided state or condition. After graduating from college, he was in limbo for a while, trying to decide what to do next.
Oscillates (v) = wavers, hesitates, vacillates, dithers, fluctuates, blow hot and cold, be indecisive
Wild goose chase (idiom) = a complicated or lengthy and usually fruitless pursuit or search.
Validity (n) = rationality, legitimacy, soundness, legality, legitimacy, authenticity, lawfulness
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