Tokenization

Over the course of the past decade, cryptocurrencies have developed from a marginal phenomenon to an important, innovative financial instrument. The best-known example of a cryptocurrency is likely Bitcoin. Although different cryptocurrencies vary somewhat in their technical details, they are generally built on the same basic technology: The «blockchain», a digital accounting system which is maintained in decentralized fashion by all those participating in a crypto-trade system and is protected from any falsification by a wide range of technical measures. The economic importance of this technology arises from the fact that it does not depend on any central issuing authority and can be accessed in a very straightforward fashion from all around the world. It is often referred to as a «Distributed Ledger Technology». In Switzerland, such technologies are regulated by new laws which came into effect in September of 2020, putting them on a very solid legal basis.

Using blockchain technology, various assets can be traded. A multitude of new possibilities and opportunities has arisen from this. Trade is not limited to digital currencies, like bitcoin: It is also possible to buy and trade shares in physical assets — from real estate to art to vintage cars and many more. In this way, almost any kind of property can be made available to investors, with very low barriers to entry.

A particularly noteworthy pioneer in this field is Sygnum Bank AG, based in Zurich and regulated by the Swiss Financial Market Supervisory Authority (FINMA). Sygnum is the first Digital Asset Bank with a Swiss banking licence, and made history in the fields of both art and finance in July 2021, when it tokenized Pablo Picasso's work «Fillette au béret» by making shares of the work available to investors in the form of crypto-tokens.

Sygnum's products and services combine the security of a regulated bank with the agility and technological innovation of a global digital asset specialist. Their considerable know-how in this field make them the perfect tokenization partner for the Victory Works Collection.

The tokens representing shares in the tokenized Victory Works will be issued by Victory Works AG, which was founded specifically for this purpose. The tokens will be available through the online platform «Desygnate», operated by Sygnum Bank AG. Trade in these tokens will take place through Sygnum Bank AG's platform «SygnEx». The minimum purchase amount is one token. Initially, three Victory Works will be tokenized, at a value of CHF 2'000'000.- per work. A total of 6000 tokens will be created for this portfolio. 2999 of these will be available for purchase, while 3001 will remain the property of Victory Works AG. 20% of the earnings arising from these 3001 tokens will be used for charitable purposes, with a particular focus on children in need in developing countries.

Several important steps will be taken in the coming years in order to raise the public profile of the Victory Works Collection, with the goal of achieving a significant rise in value. These steps include the first large-scale exhibition of the Victory Works, the signing of new works dedicated to the upcoming world cup in Qatar, and the publication of an academic work about fusionist art by Prof. Dr. Manfred Faßler (Goethe University, Frankfurt am Main, Germany).