Traditional asset services need intermediaries. For example, a trusted third party is needed to complete the asset owner’s verification, authentication and notarization. Asset circulation can only be completed with the intervention of asset issuer, asset recipient and circulation platform. There are several pain points in the current tripartite model: (1) Even the piece of asset has been circulated, it still relies on the issuer’s system to complete the usage and transfer, which limits the circulation only among the user group and within the issuer’s system. (2) Channels are monopolized by major players who could charge high prices and therefore increase the circulation costs significantly. It is difficult for the small channels and individuals to play a role in the circulation.
Blockchain can be used in asset registration, trade confirmation, account keeping, reconciliation and clearing. Groups along the transaction value chain, including upstream and downstream agents like issuer, trading counterparties, exchanges and circulation channels can all conduct businesses by themselves.