What Are Digital Assets?

For good and obvious reasons, the phrase “digital asset” has become more popular in the business, marketing, and finance sectors. According to global statistics giants- Statista; “Revenue in the Digital Assets segment is projected to reach US$37,240.00m in 2022, and revenue is expected to show an annual growth rate (CAGR 2022-2027) of 17.30% resulting in a projected total amount of US$82,710.00m by 2027” on the global scale.

Nigeria as well is not left behind in this top business trend, as Statista has it that: “In the Digital Assets segment, the number of users is expected to amount to 17.00m users by 2027.”

That’s great news! Even then, as it stands, there is still a considerable knowledge gap on what digital assets are and what they are not, despite the rise in their utilisation.

What exactly are digital assets? Are they just generic digital files? Or something else?

In this article, we’ll examine the essential rudiments of digital assets and the significance of digital assets to your organisation.

Table of Contents

What Are Digital Assets?

According to Wikipedia, A digital asset is anything that exists only in digital form and comes with a distinct usage right.

In the past, many people believed digital assets were limited to images and videos. However, as time went on, other digital file forms such as spreadsheets, documents, and presentations also became part of the definition.

Digital assets are a type of asset that includes all forms of data, including digital currencies and other crypto assets, stocks, bonds, and mutual funds. They are intangible forms of property recorded in a computer system, stored electronically, and transferred electronically.

Unlike traditional tangible assets like gold, diamonds, etc., digital assets do not have physical forms but are represented by numbers or characters (strings).

Digital assets can be used as a form of payment like money; however, unlike fiat currency such as the Naira (Nigerian currency), which has no intrinsic value beyond its use as legal tender for transactions. Some digital assets, like a family photo on your phone shot at a gathering, could only have value to just one individual. Others might be useful to a much larger audience.

A digital asset must first have the ability to produce value, meaning that it can be used in a way that benefits the owner to be regarded as an asset.

Digital assets can also pass ownership by purchase, gifting, or other means of granting the rights to any other person, along with the value the thing can add. Additionally, it needs to be findable or stored in an accessible location.

Examples Of Digital Assets

Digital assets can be of a wide variety. Listed below are many of the well-known ones:

Audio/Music
Animations
Book
Content
Documents
Design Files
Emails accounts
Graphics
Illustrations
Logos
Mails
Manuscripts
Metadata
Photos
Social media account
Videos

Blockchain and related technologies are the foundation of more recent digital assets like:

Central Bank Digital Currencies
Cryptocurrency
Non-Fungible Tokens (NFTs)
Security Tokens

How Are Digital Assets Created?

Digital asset creation is the process of creating digital representations of any physical object or thing. Digital assets are created by scanning and digitizing real-world objects, such as books, pictures, music, video games, and movies. The process of converting an analogue object into a digital format is called “digitisation.”

The most common digital assets are images, audio files, and videos. And to make these files easily accessible online, they must be compressed for transmission over networks.

Digital assets can also be purchased or exchanged from person to person.

Digital Asset Management

Digital asset management (DAM) is the process of managing digital assets, including data and software. And it includes the following:

Identifying, documenting, and tracking an organisation’s digital assets.
Consolidating them into one location for monitoring and easy retrieval.
Secure access provision and compliance with organisational policies regarding sharing information among employees or partners outside your company.

To manage your company’s digital assets effectively, you will need a team that can work across multiple platforms like Windows, macOS, AWS, and Linux on different device form factors – desktops, laptops, phones, etc. And for this reason, most companies today use in-house IT teams rather than going out into the market to look for help from external vendors.

Digital Asset Companies

Digital asset companies are the latest trend in the world of investing. These companies are firms that manage, store and distribute digital assets. They are involved in the exchange of virtual currencies like Bitcoin and Ethereum, as well as digital certificates like stock certificates or bonds. They have been around for a few years and have only recently gained popularity. Some of them even offer their services internationally.

Examples of digital asset companies include:

TenX
Bitconnect
Binance
Fireblock
Illumio
BitPanda
BlockFi
Challenger Deep (Kaiko)
Elliptic
Dataminr

Conclusion

Digital assets have the potential to completely revolutionise the Nigerian economy. Nigeria is one of the most advanced countries in Africa when it comes to digital asset utilization. As a result of this, there are many people who have started using digital assets as a means of payment on a daily basis. Some businesses have even started accepting digital assets as payment for goods or services. This has led to the emergence of several companies that provide these services.

One thing that has always been missing from the Nigerian financial system is an efficient way of transferring money between different banks and accounts without having to pay high fees. This is why more and more people are starting to use digital assets as their preferred means of transferring money between different accounts.

It is important for all Nigerians to understand how they can benefit from using digital assets so that they can take advantage of all the opportunities available and also make informed decisions about how best to use them in their organisations.

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About the Author

Adedeji Jedidiah Ogunsola is a senior writer covering science and technology and delivering all the best updates on ideas you love and some you never knew about. Previously, he was a Blockchain and technology writer at The African DeFi Oracle and worked at HalliDay Consults. In 2021, he won the Technology Journalist of the Year at Lens Inc. writers’ award. He was born in Ibadan, lives in Akure, and is a graduate of the Federal University of Technology Akure. When not working, he’s likely spending time playing chess or reading.

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