What are digital assets?
Before managing a portfolio, understand the basics of digital assets and how they differ from traditional assets.
What are digital assets?
Digital assets are forms of assets that exist on a blockchain, such as cryptocurrencies, stablecoins, or other tokenized assets.
Unlike traditional assets, they are not recorded and managed by a bank or a single institution. Instead, they are verified and maintained by a distributed network.
Cryptocurrencies
Examples include BTC and ETH.
Stablecoins
Examples include USDT and USDC.
Other on-chain tokens
Other assets represented in token form on a blockchain.
How are they different from traditional assets?
Digital assets differ from traditional assets such as stocks, cash, or real estate in several important ways.
01
Custody
Traditional assets are often held by banks or brokers, while digital assets are often managed directly by the user through a wallet.
02
Transfer method
Digital assets can move directly across a global network without an intermediary, which also means actions require more care.
03
Irreversibility
Most on-chain transactions cannot be reversed once they are completed.
04
Volatility
Digital assets often move more sharply in price, so a clearer sense of risk is important.
Why understand this before managing assets?
In Web3, asset management is not only about watching numbers change.
You also need to understand where the asset is, which wallet is involved, what permissions exist, and what each transaction actually does.
If you want to manage assets further
After understanding the basics, you can start using tools to track and organize your assets.