What Are Cryptocurrency Smart Assets?
Smart assets are unique virtual currency tokens that may represent a tangible real-world asset or non-tangible ownership that can be purchased, sold, or exchanged as defined by the rules of smart contracts on the blockchain network.
- Smart assets are the underlying assets of smart contracts.
- NEM, which stands for New Economy Movement, is a peer-to-peer cryptocurrency and blockchain that uses smart assets.
- Physical assets are intended to be the basis for smart assets.
Understanding Cryptocurrency Smart Assets
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.
For example, if you have a royalty-linked patent on an e-book 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 regarding if and how the authors can sell their royalty smart asset tokens to only 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.