The working group’s goal is to create a standardized method to represent a token across all blockchain networks to remove transactional friction and reduce processing costs. The standards will support automation and provenance tracking, and will enable the interoperability of transactions on a global scale.
XBRL provides a free and open financial data standard that companies and governments use to reduce the cost of reporting and collecting data, and to improve financial information quality.
The working group will develop goals and action steps by early 2017. It is seeking participation from individuals representing finance, technology and accounting to offer expertise in creating tokenization standards for all asset classes.
Image from Shutterstock.
Also read: Industry leaders reach agreement on blockchain governance
Tokens, as representational units of assets, enable the mapping of an account to an asset and maintain its record of ownership. Tokens are assign ownership and rights of underlying assets on a blockchain that transact through smart contracts.
ConsenSys, a production studio building decentralized applications for blockchain ecosystems, primarily focused on Ethereum, and XBRL, a standards consortium, have partnered to develop standards for tokenization of assets on blockchains. The standards will reduce friction in transactions and processing costs.
“Blockchain is the future for financial products and financial transactions,” said Campbell Pryde, president and CEO of XBRL US. “Creating a standard method to tokenize transacted assets is necessary to communicate ownership and value. Without standardization, the speed, accuracy and automation promised by smart contracts on the blockchain, simply will not happen.”
“We envision a future where all asset classes are tokenized, and act as bearer instruments that are facilitated and recorded on the blockchain,” said Griffin Anderson, director for blockchain accounting at ConsenSys and a founding member of the Accounting Blockchain Coalition.
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