Tokenized Asset Transfer Rights / Naim Ashhab

Transcript

hi guys uh uh yeah my name is Naim I work for Pawn at Pawn we are building peer-to-peer mortgage protocol and today I'm here to talk about tokenized asset transfer rights uh before that I have a small uh not questionable like I want to ask you a favor I had a bed with my friends he's he's sitting right behind that door we bet how many times he will clap during the presentation so I'll ask you throughout the presentation to clap without any purpose so please just do that help me the vet so we'll start right now please thanks amazing that's one so let's get to it so uh first this is the agenda it's very

simple we'll talk about what the tokenized transfer assets are uh why it's useful and uh how we can actually build that so what are asset transfer rights uh you could probably guess that asset transferrites are rights to transfer an asset in the current ecosystem it's uh it's assigned to a token owner or approved address uh we can tokenize that by tokenizing that we mean creating a new token represent representing the the transfer rights giving the token holder uh and nobody else the right to transfer the

underlying asset so even though I'm the owner of the asset the ATR token is held by somebody else I cannot transfer it yeah that was it that's the tokenizing tokenization of asset transfer rights thank you so why they are useful first use case I want to talk about is security so imagine you have some kind of very valuable nft with the utility assigned to it you won't use the utility quite often it can be proof of ownership by signing an option message or it can be actual uh on chain transaction which would uh give you I don't know it can be in a gaming asset for example very

valuable gaming asset uh right now you would have to deal with the trade-off you can store it in a safe which is very safe uh but it's very inconvenient to actually use the utility there uh you would have you had you would have to oh it's all slides okay nevermind let's keep with that or you can actually keep it in your hot wallet where uh using the utility is super convenient uh you can use it um every second basically you can sign a new message but it's very insecure in case of uh private key is leaked uh the hacker could basically join all your

valuable nfts with tokenizing of uh transfer rides you can do this little trick you can actually keep your nft in your hot wallet benefiting from all the utility and easy signing but tokenizing the transfer it and holding them in a safe so if you think about it actually you don't want to transfer that asset that often so it's quite okay if you have to once per I don't know a year let's say pick up your uh Ledger or a treasure or whatever and actually go through the inconvenience think of transferring the asset but you want to use the utility quite often so this is a great uh this is this is a great setup your assets are safe but you can still use the utility

very very easily this is just a slide to sum this up in case somebody is watching just the slides and it goes down to this the owner can still use the utility of the asset from the hot wallet and in case of a hot wallet hack the hacker cannot steal any assets this is amazing thank you thank you so the next use case is renting currently you have like three options you can use the wrapper uh that's that's fine but the wrapper is the true owner of the asset so if you need to actually sign a proof of ownership you won't be able to do that uh

if in case of airjob the airdrop will be it will be draw basically to the wrapper another way is having your renting natively in an asset contract a lot of game five assets actually do that the problem with that is that the holder is stuck with one branding model last thing is provide extracilateral it can go down two ways first you will be able to basically rent only asset with the price Oracle which will decrease the the subset of assets you can actually rent and you are risking liquidations second way is that the the renter is basically risking that the collateral

will have a will have less value than the rented asset itself and the Tenant will will actually not return it so what we can do we can actually again you can guess if we tokenize the transfer rate it's super super helpful in this in this case so uh you can you you can you have some renting protocol let's say the renting protocol will tokenize the transfer rate hold them in as a collateral and transfer the asset to the to the tenant the tenant is the true owner of the asset so we can sign whatever he wants and as long as long as the terms are met so in case it's a it's a time it could be uh installments whatever rent uh the

tenant can actually use the protocol use the asset but in case of default the protocol will basically transfer the asset back to the to the original owner so there is no need for extra collateral the ATR token is a collateral itself the tenant is the true owner of the asset and asset owner is not locked with one renting model which is great because it goes into this like money Lego narrative we are building in the D5 space in these days uh another use case in is the lending it's very similar to renting but with the with the roles a little bit uh shuffled around so uh again you have a borrower uh he wants to raise money for something but uh the asset he wants to

use as a collateral actually has some utility assigned to it so what he can do instead of locking it during the the whole duration of the loan he can tokenize the trends right and use the transfer rights as a collateral again there is some kind of lending protocol in case of default the protocol will transfer the asset back to the lender so again no need for extra collateral the ATR token is the collateral user keeps the ownership of the asset so let's say you have a decentralized parcel and you want to actually raise money to build something on top of it you won't be able to do that with uh D file Landing protocols in these days because the parcel will be locked in that protocol you want you are not the owner so you

cannot build anything on top of it by using ATR you you will you will be able to do that you are the owner you cannot sell it you cannot transfer it but that's fine that's that's the point of it uh lender can claim underlying asset in case of default via ATR another thing is that it nicely upgrades the buy now pay later user experience so again I'm buying something I have just 30 of the price of that of that nft let's say I can borrow the 70 the 70 uh the protocol will pull these assets together we'll buy the asset tokenize the transfer rates send me the asset but keeping uh the tokenized transfer rights

in the collateral uh in in the vault using them as a collateral for the loan I took to fund the the rest of the rest of the asset yeah and all it almost feel like under collateralized loan you're actually buying something with just 30 of the funds and you are actually getting the ownership of that asset which feels pretty nice yeah so instead of transferring an asset to a vault for trustless claim use ATR token as an assurance of claim uh just be careful it's a not Silver Bullet it would it wouldn't work for mutable derivative tokens uh because the the owner

the asset is owned by somebody even though he cannot sell it or transfer it he can mutate it so for mutable tokens uh I can like decrease the value by for example this uni V3 lpnft I can just drain all the liquidity from it so even though I cannot like sell it or burn it uh I can I can degrade the value so just like keep that in mind that it's not a silver bullet you have to pick your use cases it goes down to this so if you should live with something from this presentation it's that ATR token is the ultimate collateral please round off Applause you're amazing thank you

so yeah that was the why the few use cases I wanted to mention and then and now how to implement them we have two ways one is natively uh if the asset actually supports tokenization of transfer rights and second is by some kind of smart contract wallet which would allow us to tokenize the transference of the asset hold in that safe and uh actually respecting the transfer constraints the native approaches is great uh there is no it's much safer there is no big like issues hiccups with that uh you can actually let the owner to approve any other address uh the the asset contract would simply not allow

them to execute the transfer to execute the burn for example you kind of like destroy the asset neither uh the cons is that immutable Legacy asset will never support it it's just if they are immutable and deployed we cannot like we cannot give them this utility and we need to wait for new assets to implement it to be able to use it on the other hand the smart contract wallet uh they can support Legacy assets we can use them immediately but uh they they have some trade-offs aligned to them so let's say you have an asset with some non-standard approval uh the issue with that is that the smart contract wallet

should be has to be able to prevent this transaction from happening because it can check only things initiated from that wallet so if there is an issue with approvals it's the basically what I'm talking about right now so I cannot allow assets with tokenized transfer rights to to the owner to to approve another address because the approved address would basically call the the contract asset directly and it would bypass all the smart uh all the contract wallet constraints I'm putting on the on the asset and it has some gas overheat on top of it the problem is zero percent of assets supports ATR

tokenization natively it doesn't make sense to Clive here but yeah thank you so I wanna I don't want to talk along about that but I want to pitch Pawn save here uh we built some uh we build this smart contract wallet which allow you to tokenize the transfer rights and use it actually in our protocol so what the pawn safe is it's a safe multisig contract wallet which with custom guard and module contract that can mint ATR tokens on behalf of an asset owner and enforce transfer constraints who knows what the module and guard in a safe ecosystem is when you raise your

hands please nobody cool so module is a contract which you can align to any safe and the module is able to initiate any transaction without reaching the owner's threshold so on one hand it's super powerful on the other hand it's super dangerous the guard is the is a contract which you can again align or connect to the to your safe which will check any transaction before and after it happens so with those two uh parts of the safe ecosystem we were actually able to build a contract wallet which would allow you to tokenize the transfer rights use them

wherever you want and uh give the ATR token holder the ability to transfer the asset from some safe even though he's not the safe owner if you want to read more about Pawn save here is a there's a link to announcement blog post and uh yeah that's it uh there was the tokenization of transfer rights my name is Naim you can reach me on telegram on Twitter with this handle and uh yeah if you have any questions so after one round of applause great so it's definitely a question it's also a this is like a HomeTown project

uh first question hi hi my question is um sorry I I try to I'm just trying to understand exactly how this thing works so if I tokenized the transfer rights of certain token so does the original token gets locked in my wallet is that how it works yes what you effectively do you will create a soul bound token from that token with the ATR token being like the key to transfer okay sure so if my if my token gets locked in my contract that also makes the token like lost a lot of utility it could be used you know for what you wanted to be used before so it's kind of kind of like the fit half

50 of the purpose it seems like if I understand it right like let's say you know you give the example of that I wanted to use my nft or other things but like without actual transfer rights because that was gone and a lot of utility of that particular token could be lost is that right if the utility of the token is just being able to transfer it then yes but say playing utility I mean something like on top of it like yeah we have standards like 721 1155 which basically defines how to transfer token nothing else what I mean by utility is okay let's say my nft will give me access to a Meetup or actually I can use it in a game I can increase level of my character whatever so this

is the utility I'm actually talking about not the transfer thing okay sure sorry another quick question again um a lot of the things that you mentioned seems that are achievable with token permits like through the like uniform uniform permit 2 for example I mean without needing of tokenization um with token what token permit token permits okay yeah like like uniform have a permit two that you can actually sign off your transfer right to Department two and then just give a permit to anyone that can actually transfer on your behalf seems like it's kind of doable um is that something you've considered

it's a little bit different the permit is basically signed approval so I can do that now yeah I can give you right to transfer it but I'm not taking the right from me the idea is that I am not able to transfer it in case of the lending or renting I as a lender want to be sure that you cannot transfer it from your wallet because in case of default I want to be able to transfer it from YouTube back to me so I want to be or I want the right to be locked somewhere that the idea behind it so permit yeah it's just signed approval but it's not like I'm giving you the right and I'm like taking the right from me so we we have now um we moved from Soul bound tokens now to nfts as wallets

um how do we how do you see the permissions working there with this new standard it can work the same way uh you can probably work around that that uh you mean the aip6551 I guess yes right yeah um there will probably have to be some Trend Trend transient ownership where if I'm the nft holder I have access to the wallet and I can somehow prove that I'm the owner of the asset inside so if the asset inside has some utility assigned to it where I need to sign some off-chain stuff they probably have to be able to say okay it's an in an nft wallet and you are the nft holder uh but

still if you use that nft as a collateral somewhere the vault is the owner so I think it it works the same way here and in the context of the nft wallet I would I would say it's more like a mutable token where I'm still the owner so I have access to the wallet but I can drain it so it's like a state for that token the wallet is basically like a state that's how I would like uh look into it like that that's a really that's a really great simplified way of saying it that it's a state it's a state yeah yeah do we have another question because I'll ask another one if we don't so I think it's pretty clear that that um that tokenized assets are not even in

their infancy yet in terms of market share in terms of development uh in terms of uh mind share even with people usability there's projects like materiums working on asset passports for different things at what point do you think that we'll have sort of like a cultural acceptance of digital notarization because in the end you know you have a escrow and we have notarization looking forward how far out do you think that we are from really you know massive usage and growth in tokenized assets that are

not necessarily our classic pfps and stuff like that so if I understand the question your question is how far are we from tokenizing Real World assets yeah uh honestly I don't want to even guess I think it's much harder thing to do because it's uh it has the burden of the regulation and existing like loss and stuff so it's not just okay we are this shadowy supercoders and we are just building stuff and we can Break Stuff quickly so uh honestly I don't know I would hope to be I I would hope it to be as soon as possible so we can actually see for example loans backed by real

world assets but yeah I don't have any guests okay so just to be clear when you speak about tokenized assets you're talking about tokenized digital assets digital assets yes okay awesome as soon as you have the representation of the real world asset in the digital space the same like things applies there great so that gives us out of time thank you so much uh for coming here today and sharing your knowledge with us thank you guys [Applause] [Music]