On February 14—Valentine’s Day—a group of 10 collectors paid $1 million in cryptocurrency to buy a virtual piece of art called The Forever Rose.

It’s the most expensive piece of crypto-artwork ever sold.

Famed photographer Kevin Abosch auctioned the art on an Ethereum-based blockchain platform.

While you can’t touch the artwork or hang it in your home, collectors can choose to hold their “rose token,” sell it, or give it to someone for a special occasion.

The Forever Rose

The only thing that separates this photograph from all others is that Abosch sold it on the blockchain instead of through a traditional auction house.

I’m not telling you this story because I think The Forever Rose is a good investment. I don’t see how it’s worth $1 million.

I’m telling you this story this because it represents a new trend of “tokenized” assets. This trend will open new opportunities for everyday investors like you and me.

What Is Tokenization?

Most people don’t know what it means to “tokenize” something.

But therein lies our opportunity. We’re way ahead of the curve. And that’s where money-making opportunities are found.

Let me explain…

Tokenization is one of the biggest ideas for applying blockchain technology to traditional asset classes.

Regular readers know the blockchain is the underlying technology of cryptocurrencies like bitcoin.

Initially, blockchain technology was used to record cryptocurrency transactions. But the same technology can now be used to record all types of transactions and records.

Just think about your car title. It’s registered with a centralized agency, like a motor vehicles department. Centralized agencies register all types of other assets, too, from stock certificates to property deeds.

For instance, if you want to sell or buy an asset like a house, it takes a lot of time and paperwork… and you must go through numerous intermediaries. The process takes weeks.

The blockchain promises to make the process of transferring assets (like a house) much simpler and much faster by eliminating all the paperwork involved.

In other words, instead of recording asset ownership on paper and filing it away, it’s recorded in computer code and stored (“tokenized”) on the blockchain.

So instead of taking days or weeks to mail paper documents, you can transfer tokenized assets almost instantaneously over the blockchain.

Because the blockchain is public, each tokenized asset is verified… You know that if someone says they own something, they actually do. You know if someone says they have the money to buy something, it’s there.

When assets are tokenized, you can trade them, exchange them, and even buy them in fractions like the collectors did with The Forever Rose.

The Tokenization Trend Is About to Start

New technology often starts with something novel. In the case of tokenization, The Forever Rose will likely go down as the moment this trend became real.

There are two reasons…

  • It makes it easier to buy and sell art

Today, people who want to sell expensive pieces of art need to use auction houses. It can take months before the auction is held. And sellers usually pay hefty commissions.

If art is tokenized, you can sell it without an auction house—thus eliminating a third party. Plus, the tokens make the art more “liquid.” In other words, you could sell the art for tokens, then easily convert the tokens to cash.

  • It makes artwork accessible to more people

The most expensive painting in the world is Leonardo da Vinci’s Salvator Mundi. It sold for $450.3 million last November.

Not many people can afford a painting like that. But if Salvator Mundi were tokenized, more people would be able to own a portion of it.

Just like The Forever Rose, multiple people could buy “shares” in famous art pieces.

Imagine owning your own share of da Vinci’s Mona Lisa, Van Gogh’s Starry Night, or Picasso’s Guernica.

I’ve seen estimates that tokenizing art could increase the value of these assets by 20–30%. The art collectibles industry is worth about $3 trillion… So tokenization could add $600–900 billion to this space.

And art isn’t the only asset that will be tokenized soon…

Other Physical Assets Will Be Tokenized

I believe you’ll soon see tokenized real estate assets.

For example, you could tokenize your home… and auction it to the highest bidder on the blockchain.

After that, we could see stocks, commodities, bonds, gold… and any other physical asset you can imagine… get tokenized.

According to one estimate, there is $517 trillion worth of assets that could be tokenized.

Of course, all of these assets won’t be tokenized… But even if just a tiny fraction is, that means a lot of upside for crypto tokens.

The best way to position yourself for this trend is to take small positions in bitcoin and Ethereum. They are the largest, most secure, and most established blockchains. They are unhackable, and once something is written to them, it’s there forever.

Token providers will use these networks to launch many of their projects.

If you do invest in this emerging asset class, we always recommend that you take a small position size. Don’t bet more than you can afford to lose…

Cryptocurrencies are volatile. So small position sizes will allow you to keep a cool head during extreme periods of volatility in the crypto market.

Regards,

Nick Rokke, CFA
Analyst, The Palm Beach Daily

P.S. Asset tokenization is just one reason we’ll see cryptocurrencies make history in 2018. According to a recent Thomson Reuters survey, about 20% of financial firms indicate they will begin trading cryptocurrencies over the course of this year. A major national exchange also has announced it’s backing a bitcoin ETF.

So it’s no wonder cryptocurrencies are starting to break out of their recent bear market.

Since July 1, bitcoin is up 15.6%. PBRG guru and world-renowned cryptocurrency expert Teeka Tiwari thinks that’s just the start. He says several tailwinds will combine to push the crypto market up another 10 times from here before the year is over.

Teeka’s so confident that cryptos will continue their epic rise this year that he’s giving away $2 million worth of bitcoin to new subscribers.

To learn how to claim your share of this giveaway, plus receive Teeka’s full list of 32 cryptocurrencies to buy right now, click here…

MAILBAG

Mostly positive feedback from readers about our week-long crypto series leading up to Teeka’s big broadcast yesterday: The Great Cryptocurrency Conspiracy of 2018 (You can watch the replay of the event right here.)…

From Karl H.: Thanks, Teeka. Like myself, there is a growing community that studies and discusses cryptos in depth. It is much bigger than money. It has the ability to harness and unleash the will of billions of people. 

We will have the resources and ability to take down all those who intend us harm. Cryptos give us the ability to strip power from the establishment.

From Ebenezer O.: It’s my pleasure to thank Teeka for the wonderful job he’s doing. I followed your broadcast and feel elated. I really want to invest in cryptocurrencies and l will need your guidance to do that.

From David W.: Your broadcast was very informative! I wish I had seen it in June 2017.

From Barry S.: Teeka, I appreciate your candor. Following your advice has been a good way for me to sort out the noise in the complex crypto market.

From Ben Y.: When I can hold bitcoin in my hand, I’ll be interested! I don’t trust the internet.

And a shout-out for PBRG’s newest addition, Palm Beach Trader editor Jason Bodner…

From William H.: Jason, I like your service and your clear, confident style.

Send your questions and comments to us right here…