DEFINITION of 'Smart Assets (Cryptocurrency)'

Smart assets are unique virtual currency tokens that may represent a tangible real-world asset, or a non-tangible ownership that can be purchased, sold, or exchanged as defined by the rules of smart contracts on the blockchain network. 

BREAKING DOWN 'Smart Assets (Cryptocurrency)'

The smart asset may be a virtual representation of a physical asset, like a property or a car, or it may represent virtual goods, like a bitcoin, an equity share, or a patent on a novel product. Each smart asset is associated with a smart contract that governs its usage. (See more: Understanding Smart Contracts.)

For example, if you have a royalty-linked patent on an ebook that you co-authored with a friend and published on an Amazon Kindle-like platform, then all the royalty payments will be automatically calculated and credited to the respective accounts based on the defined smart contract, including the price paid to the Kindle-like platform.

The smart contract may also have defined terms about if and how the authors can sell their royalty smart asset tokens only to a select group of partners, and on what conditions.

Smart assets offer a great degree of autonomy, anonymity, and low-cost of transactions in the P2P blockchain network compared to those in the real world. They are popularly used concepts in many emerging blockchain networks, like NEM.

RELATED TERMS
  1. Smart Money

    Smart money is the capital that is being invested or withdrawn ...
  2. Smart Market

    A smart market is a type of auction in which transactions are ...
  3. Hyperledger Burrow

    Hyperledger Burrow is a permissioned Ethereum smart contract ...
  4. Closed Virtual Currency

    A closed Virtual Currency is an unregulated digital currency ...
  5. Physical Asset

    A physical asset is an item of economic, commercial or exchange ...
  6. Blockchain ETF

    Blockchain ETFs facilitate real-time trading on a basket of blockchain-based ...
Related Articles
  1. Tech

    How Are Disputes In Smart Contracts Resolved?

    Smart contracts are expected to revolutionize business contracts. But they need to develop mechanisms for dispute resolution first.
  2. Investing

    Smart Beta ETF Myths and Misconceptions

    Discover smart beta exchange-traded funds (ETFs), and learn about some of the common misconceptions and characteristics of this type of product.
  3. Investing

    Could Smart Beta ETFs Be a $1 Trillion Market by 2020? (BLK)

    One ETF giant believes the smart beta ETF market will grow at double the pace of the overall ETF market over the next several years.
  4. Financial Advisor

    Building A Better Mousetrap With Smart Beta ETFs

    What exactly are smart beta funds and how can they be used in a portfolio?
  5. Investing

    Smart Beta Asset Growth Continues Booming

    Smart beta ETFs continue adding assets at an impressive clip.
  6. Tech

    Ethereum Smart Contracts Vulnerable to Hacks: $4 Million in Ether at Risk

    About 34,200 Ethereum smart contracts worth $4.4 million in ether are vulnerable to hacking, according to a new report.
  7. Investing

    Another Record for Smart Beta Assets

    Smart beta ETFs tallied another record year of asset gathering in 2017.
  8. Investing

    How Smart Home Technology Can Help You Sell Your Home

    A $1,500 smart home investment could return up to $12,500. Read more to find out what industry professionals are saying about smart homes and why you should invest in smart home technology.
  9. Tech

    ICO Security Playbook: 5 Steps to Ensure Best Practice

    Despite cryptocurrencies’ touted security advantages and blockchain’s own defenses, challenges remain.
  10. Investing

    Are Smart Beta ETFs Hyped? (PRF, BLK)

    Pay attention to the percentage of smart beta ETFs that manage to survive after the next five years, proving or refuting the existence of a hype.
RELATED FAQS
  1. How do fixed assets and current assets differ?

    Current assets can be converted into cash in less than one year, while fixed assets are long-term physical assets. Read Answer >>
  2. How do tangible and intangible assets differ?

    Tangible assets are physical assets that are used in a company's operations. Intangible assets are nonphysical, long-term ... Read Answer >>
  3. How are net tangible assets calculated?

    Learn about net tangible assets, what it measures and how to calculate a company net tangible assets using examples. Read Answer >>
  4. Why should you invest in tangible assets?

    There are several benefits to investing in tangible assets, such as bullion, real estate, art, collectibles and other physical ... Read Answer >>
Trading Center