Tokenization is an intrinsic part of the Blockchain technology that serves the purpose of platform identification and accessibility.
For example. Bitcoin is a token. And so is Litecoin, Dash, and other currencies that function over a blockchain. While tokens can represent money, as in the examples above, they can also represent other things.
The demand for a particular blockchain product or service is usually the main determinant of the value and eventual market price of its token. This is why there is a variation in the prices of different altcoins in the Blockchain environment. For example, Bitcoin is more readily accepted by merchants than Litecoin, and is consequently more valuable.
Broadly speaking, tokenization is the process of converting some form of asset into a token that can be moved, recorded, or stored on a blockchain system. That sounds more complex than it is. To put it simply, tokenization converts the value stored in some object — a physical object, like a painting, or an intangible object, like a carbon credit — into a token that can be manipulated along a blockchain system.
Blockchain tokenization is powerful because it has the potential of tokenizing everything from “gas” on the Ethereum blockchain (GasToken), to fine art, real estate, or even “attention” (Basic Attention Token), which have applicability in social media and advertising. There is also the possibility of tokenized governance — making 1 token worth 1 vote in meetings for some organizations.