Digital securities exist as tokens on a distributed ledger and do not require intermediaries. Therefore trades can be settled 24/7 in near real-time. Furthermore, by improving accessibility and the possibility of trading the asset on a secondary market, more and different types of investors can invest in securities that before could not enter the market.
Digital securities also enable fractional ownership of assets, further lowering the entry barrier for investors and creating liquidity in less liquid markets like private equity and real estate.
Because of the distributed nature of a DLT, no single party can alter the data, creating a secure single version of the truth, which all participants can access and rely on, including advisers, auditors, and regulators.
Digital securities automatically record administrative tasks of purchasing and selling securities, including corporate actions like the payout of dividends. As a result, digital securities have lower operational costs.
The lifecycle of Algorand-based tokenized bonds