Market Infrastructure
Last updated
Last updated
In this section, we will introduce Collaterize's on-chain market framework, which consists of two interconnected components: a primary market for the issuance of approved tokenized products and a secondary market that enables these RWAs to be traded on our platforms, DeFi applications, enhancing the asset's liquidity.
Before Listing:
The initial deal structuring stage is crucial in determining the terms and conditions of the token. After the deal structuring has been set between Collaterize and the issuer, the shares are listed on the fund's primary on-chain market.
Accounting: Clarify the nature of underlying assets to account for tokens as "financial assets" and not "Inventory".
Investor Compliance: Ensure compliance with local regulations and monitor token owners and service providers according to AML/KYC guidelines.
Legal ownership: Establish funds or trusts and provide legal documentation to grant token owners rights.
Let's examine the market structure in more detail:
Collaterize accesses real-world assets from its partners, utilizing both regulated exchanges for financial products and off-markets for traditional and tangible assets. Through the primary market, Collaterize solidifies its portfolio with a diverse array of financial instruments, including bonds and stocks, as well as real assets such as real estate, art, and exclusive off-market premium assets.
After acquisition, Collaterize converts these assets into tokenized forms (NFT) and re-issues them on a 1:1 basis on the Collaterize blockchain secondary markets. This strategy significantly enhances their liquidity and global reach, revolutionizing the sourcing and management of these assets.
Collaterize is specialized in secondary market issuance. The emission of tokenized real-world assets issued on the secondary markets provides a new source of liquidity for traditional assets that are transformed to on-chain and tokenized versions.
Collaterize uses multiple channels to funnel its assets on-chain, including its own app, platform. While Collaterize only enables the acquisition of tokenized assets, these assets can be transferred to compliant DeFi markets that enable additional use-cases (e.g., lending and borrowing) therefore increasing the asset liquidity and composability. Here’s a feature overview of the tokenized assets listed on the Collaterize Secondary market:
Listing at NAV: Collaterize lists assets based on their NAV, with each tokenized real-world asset offered at the underlying RWA oracle price. This pricing system simplifies trading and enables market participants to make informed decisions based on the asset’s intrinsic value. Unlike traditional order books with fluctuating bid and ask prices, Collaterize ensures a stable pricing structure that aligns with the true on-chain value of assets, continuously updated at the oracle NAV price.
On-chain settlement: Collaterize’s order book combines features of both centralized and decentralized exchanges, creating a stable, transparent, and efficient environment. Participants can submit orders specifying the quantity of tokenized assets. The price is set by combining either market oracle valuations or expert valuations, depending on the asset class. Transactions are executed when counterparties match the orders. Collaterize's hybrid approach enhances liquidity, transparency, and security.
By bridging the gap between traditional finance and DeFi, Collaterize empowers institutions to access innovative financial products and services that were previously exclusive to the crypto ecosystem.
