How to Choose the Right Blockchain Protocol for Your Tokenization Project

Karolina

19 Jun 2023
How to Choose the Right Blockchain Protocol for Your Tokenization Project

The rise of blockchain technology has paved the way for numerous innovations across industries. One such innovation is tokenization, a process that allows assets, both tangible and intangible, to be represented as digital tokens on a blockchain. This breakthrough has opened up exciting possibilities for enhanced liquidity, fractional ownership, and efficient asset management. However, the success of any tokenization project hinges on selecting the right blockchain protocol. With numerous protocols available, each with its own unique features and capabilities, making an informed decision is crucial. In this article, we will delve into the factors that should be considered when choosing the right blockchain protocol for your tokenization project.

Understanding Tokenization and Blockchain Protocols

Tokenization refers to the process of converting real-world assets, such as real estate, art, or commodities, into digital tokens that can be securely stored, transferred, and traded on a blockchain. By representing these assets as tokens, individuals and organizations can unlock new possibilities, including fractional ownership, increased liquidity, and automated compliance.

Blockchain protocols, on the other hand, form the underlying infrastructure that powers tokenization projects. These protocols serve as the foundation for creating, managing, and exchanging tokens securely and transparently. They provide the necessary consensus mechanisms, smart contract functionality, and interoperability features to ensure the smooth operation of tokenized assets.

When considering blockchain protocols for your tokenization project, it is crucial to evaluate several key factors. Scalability and throughput, security and consensus mechanism, smart contract functionality and flexibility, interoperability and integration, and community and ecosystem support are among the critical aspects to consider. By carefully assessing these factors, you can make an informed decision that aligns with the specific requirements and goals of your tokenization project.

In the following sections, we will explore each of these factors in more detail, providing valuable insights to help you navigate the complex landscape of blockchain protocols and choose the right one for your tokenization project.

Key Aspects to Evaluate When Selecting a Blockchain Protocol for Tokenization

The importance of choosing the appropriate blockchain protocol for a tokenization initiative cannot be overstated, as it influences the project's success and efficacy. By taking into account the following key elements, you can make an informed decision that aligns with your goals. 

Scalability and Throughput

Scalability is vital in tokenization endeavors because it directly affects the blockchain's transaction speed and capacity. It is crucial to select a highly scalable blockchain protocol to accommodate numerous tokenized assets and guarantee seamless and efficient processes. Assess transaction processing rates, network capabilities, and the ability to manage increasing transaction volumes when comparing blockchain protocols. Opt for protocols that adopt inventive solutions addressing scalability issues, such as sharding, layer 2 solutions, or sidechains. Selecting a scalable blockchain protocol will safeguard your tokenization project from potential limitations and performance problems as it grows.

Security and Consensus Mechanism

The security of tokenized assets is critical since blockchain protocol vulnerabilities can result in serious repercussions. A reliable blockchain protocol must provide a safe environment for storing and transferring tokens while defending against fraud, hacks, and unauthorized access. Key security factors to consider include the protocol's history of security incidents, decentralization level, blockchain immutability, and the strength of cryptographic algorithms employed. Furthermore, examine the protocol's consensus mechanism since it dictates how transactions are verified and added to the blockchain. Different consensus mechanisms offer varying levels of security and energy efficiency; hence it is essential to choose one that aligns with your tokenization project's requirements.

Smart Contract Functionality and Flexibility

Smart contracts are crucial to tokenization projects as they facilitate programmable agreements for tokenized assets' creation and execution. Evaluate the smart contract features and programming languages supported by different blockchain protocols. Opt for protocols that provide versatile functionalities including custom logic creation, integration with external systems and data sources, and complex tokenization requirements management. This smart contract framework flexibility will allow customization to your project's unique needs, ensuring seamless tokenized asset operations. Also, assess the protocol's compatibility with existing smart contract standards and libraries to streamline development and improve interoperability with other projects.

More about smart contracts 

Interoperability and Integration

Tokenization initiatives may necessitate interoperability with other blockchain protocols or systems to utilize additional functionalities or access broader liquidity sources. Appraising the interoperability capabilities of various blockchain protocols is essential if you intend to integrate with external platforms, exchange tokens across diverse blockchains, or cooperate with other projects. Choose protocols that support cross-chain communication, atomic swaps, or bridge technologies for facilitating interoperability. Moreover, consider the protocol's compatibility with widely embraced interoperability standards and initiatives like Polkadot, Cosmos, or Inter-Blockchain Communication (IBC) protocols. Ensuring seamless integration and interaction enables smooth data exchange between your tokenization project and other pertinent systems, expanding possibilities and augmenting the overall value proposition.

More about Interoperability 

Community and Ecosystem Support

The blockchain community's strength and dynamics substantially influence your tokenization project's success. Gauge the level of activity and involvement within the developer community surrounding different blockchain protocols, as an engaged community can offer valuable insights, resources, and support throughout development. Seek protocols with a flourishing developer community, regular updates, and a transparent governance structure that fosters community participation. In addition, evaluate the partnerships and projects established on the protocol as they signify technological maturity and adoption levels. A robust ecosystem supplying tools, documentation, and assistance is essential for smooth tokenization project progress, enabling access to a wealth of expertise and fostering collaboration with other blockchain industry stakeholders.

When considering these crucial aspects in selecting a blockchain protocol for your tokenization undertaking, you can make an educated decision that addresses your project's specific needs pertaining to scalability, security measures, smart contract functionality, interoperability aspirations, and community backing. Investing time in analyzing and understanding these factors will lay a solid foundation for your project, increasing the chances of realizing your desired outcomes.

Conclusion

Choosing the right blockchain protocol is a critical step in ensuring the success of your tokenization project. By carefully evaluating factors such as scalability and throughput, security and consensus mechanism, smart contract functionality and flexibility, interoperability and integration, and community and ecosystem support, you can make an informed decision that aligns with your project's specific requirements and goals.

Scalability and throughput are crucial for handling transaction volumes and accommodating future growth. Security and the choice of consensus mechanism directly impact the safety and integrity of tokenized assets. Smart contract functionality and flexibility allow for tailored solutions and seamless execution of operations. Interoperability and integration capabilities enable collaboration with other blockchain platforms and systems, unlocking additional functionalities and liquidity pools. Lastly, a strong and supportive community and ecosystem contribute to the development and growth of your project, providing resources, expertise, and collaboration opportunities.

Tokenize Everything with Nextrope Launchpad

Our platform allows you to participate in the broad financial market of digital assets. Expand your reach and find investors globally.

Nextrope Launchpad Platform is a White Label solution in a Software-as-a-Service model that helps you launch your project within a month and fundraise with Initial Coin Offering (ICO) or Security Token Offering (STO).

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AI in Real Estate: How Does It Support the Housing Market?

Miłosz Mach

18 Mar 2025
AI in Real Estate: How Does It Support the Housing Market?

The digital transformation is reshaping numerous sectors of the economy, and real estate is no exception. By 2025, AI will no longer be a mere gadget but a powerful tool that facilitates customer interactions, streamlines decision-making processes, and optimizes sales operations. Simultaneously, blockchain technology ensures security, transparency, and scalability in transactions. With this article, we launch a series of publications exploring AI in business, focusing today on the application of artificial intelligence within the real estate industry.

AI vs. Tradition: Key Implementations of AI in Real Estate

Designing, selling, and managing properties—traditional methods are increasingly giving way to data-driven decision-making.

Breakthroughs in Customer Service

AI-powered chatbots and virtual assistants are revolutionizing how companies interact with their customers. These tools handle hundreds of inquiries simultaneously, personalize offers, and guide clients through the purchasing process. Implementing AI agents can lead to higher-quality leads for developers and automate responses to most standard customer queries. However, technical challenges in deploying such systems include:

  • Integration with existing real estate databases: Chatbots must have access to up-to-date listings, prices, and availability.
  • Personalization of communication: Systems must adapt their interactions to individual customer needs.
  • Management of industry-specific knowledge: Chatbots require specialized expertise about local real estate markets.

Advanced Data Analysis

Cognitive AI systems utilize deep learning to analyze complex relationships within the real estate market, such as macroeconomic trends, local zoning plans, and user behavior on social media platforms. Deploying such solutions necessitates:

  • Collecting high-quality historical data.
  • Building infrastructure for real-time data processing.
  • Developing appropriate machine learning models.
  • Continuously monitoring and updating models based on new data.

Intelligent Design

Generative artificial intelligence is revolutionizing architectural design. These advanced algorithms can produce dozens of building design variants that account for site constraints, legal requirements, energy efficiency considerations, and aesthetic preferences.

Optimizing Building Energy Efficiency

Smart building management systems (BMS) leverage AI to optimize energy consumption while maintaining resident comfort. Reinforcement learning algorithms analyze data from temperature, humidity, and air quality sensors to adjust heating, cooling, and ventilation parameters effectively.

Integration of AI with Blockchain in Real Estate

The convergence of AI with blockchain technology opens up new possibilities for the real estate sector. Blockchain is a distributed database where information is stored in immutable "blocks." It ensures transaction security and data transparency while AI analyzes these data points to derive actionable insights. In practice, this means that ownership histories, all transactions, and property modifications are recorded in an unalterable format, with AI aiding in interpreting these records and informing decision-making processes.

AI has the potential to bring significant value to the real estate sector—estimated between $110 billion and $180 billion by experts at McKinsey & Company.

Key development directions over the coming years include:

  • Autonomous negotiation systems: AI agents equipped with game theory strategies capable of conducting complex negotiations.
  • AI in urban planning: Algorithms designed to plan city development and optimize spatial allocation.
  • Property tokenization: Leveraging blockchain technology to divide properties into digital tokens that enable fractional investment opportunities.

Conclusion

For companies today, the question is no longer "if" but "how" to implement AI to maximize benefits and enhance competitiveness. A strategic approach begins with identifying specific business challenges followed by selecting appropriate technologies.

What values could AI potentially bring to your organization?
  • Reduction of operational costs through automation
  • Enhanced customer experience and shorter transaction times
  • Increased accuracy in forecasts and valuations, minimizing business risks
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Want to implement AI in your real estate business?

Nextrope specializes in implementing AI and blockchain solutions tailored to specific business needs. Our expertise allows us to:

  • Create intelligent chatbots that serve customers 24/7
  • Implement analytical systems for property valuation
  • Build secure blockchain solutions for real estate transactions
Schedule a free consultation

Or check out other articles from the "AI in Business" series

AI-Driven Frontend Automation: Elevating Developer Productivity to New Heights

Gracjan Prusik

11 Mar 2025
AI-Driven Frontend Automation: Elevating Developer Productivity to New Heights

AI Revolution in the Frontend Developer's Workshop

In today's world, programming without AI support means giving up a powerful tool that radically increases a developer's productivity and efficiency. For the modern developer, AI in frontend automation is not just a curiosity, but a key tool that enhances productivity. From automatically generating components, to refactoring, and testing – AI tools are fundamentally changing our daily work, allowing us to focus on the creative aspects of programming instead of the tedious task of writing repetitive code. In this article, I will show how these tools are most commonly used to work faster, smarter, and with greater satisfaction.

This post kicks off a series dedicated to the use of AI in frontend automation, where we will analyze and discuss specific tools, techniques, and practical use cases of AI that help developers in their everyday tasks.

AI in Frontend Automation – How It Helps with Code Refactoring

One of the most common uses of AI is improving code quality and finding errors. These tools can analyze code and suggest optimizations. As a result, we will be able to write code much faster and significantly reduce the risk of human error.

How AI Saves Us from Frustrating Bugs

Imagine this situation: you spend hours debugging an application, not understanding why data isn't being fetched. Everything seems correct, the syntax is fine, yet something isn't working. Often, the problem lies in small details that are hard to catch when reviewing the code.

Let’s take a look at an example:

function fetchData() {
    fetch("htts://jsonplaceholder.typicode.com/posts")
      .then((response) => response.json())
      .then((data) => console.log(data))
      .catch((error) => console.error(error));
}

At first glance, the code looks correct. However, upon running it, no data is retrieved. Why? There’s a typo in the URL – "htts" instead of "https." This is a classic example of an error that could cost a developer hours of frustrating debugging.

When we ask AI to refactor this code, not only will we receive a more readable version using newer patterns (async/await), but also – and most importantly – AI will automatically detect and fix the typo in the URL:

async function fetchPosts() {
    try {
      const response = await fetch(
        "https://jsonplaceholder.typicode.com/posts"
      );
      const data = await response.json();
      console.log(data);
    } catch (error) {
      console.error(error);
    }
}

How AI in Frontend Automation Speeds Up UI Creation

One of the most obvious applications of AI in frontend development is generating UI components. Tools like GitHub Copilot, ChatGPT, or Claude can generate component code based on a short description or an image provided to them.

With these tools, we can create complex user interfaces in just a few seconds. Generating a complete, functional UI component often takes less than a minute. Furthermore, the generated code is typically error-free, includes appropriate animations, and is fully responsive, adapting to different screen sizes. It is important to describe exactly what we expect.

Here’s a view generated by Claude after entering the request: “Based on the loaded data, display posts. The page should be responsive. The main colors are: #CCFF89, #151515, and #E4E4E4.”

Generated posts view

AI in Code Analysis and Understanding

AI can analyze existing code and help understand it, which is particularly useful in large, complex projects or code written by someone else.

Example: Generating a summary of a function's behavior

Let’s assume we have a function for processing user data, the workings of which we don’t understand at first glance. AI can analyze the code and generate a readable explanation:

function processUserData(users) {
  return users
    .filter(user => user.isActive) // Checks the `isActive` value for each user and keeps only the objects where `isActive` is true
    .map(user => ({ 
      id: user.id, // Retrieves the `id` value from each user object
      name: `${user.firstName} ${user.lastName}`, // Creates a new string by combining `firstName` and `lastName`
      email: user.email.toLowerCase(), // Converts the email address to lowercase
    }));
}

In this case, AI not only summarizes the code's functionality but also breaks down individual operations into easier-to-understand segments.

AI in Frontend Automation – Translations and Error Detection

Every frontend developer knows that programming isn’t just about creatively building interfaces—it also involves many repetitive, tedious tasks. One of these is implementing translations for multilingual applications (i18n). Adding translations for each key in JSON files and then verifying them can be time-consuming and error-prone.

However, AI can significantly speed up this process. Using ChatGPT, DeepSeek, or Claude allows for automatic generation of translations for the user interface, as well as detecting linguistic and stylistic errors.

Example:

We have a translation file in JSON format:

{
  "welcome_message": "Welcome to our application!",
  "logout_button": "Log out",
  "error_message": "Something went wrong. Please try again later."
}

AI can automatically generate its Polish version:

{
  "welcome_message": "Witaj w naszej aplikacji!",
  "logout_button": "Wyloguj się",
  "error_message": "Coś poszło nie tak. Spróbuj ponownie później."
}

Moreover, AI can detect spelling errors or inconsistencies in translations. For example, if one part of the application uses "Log out" and another says "Exit," AI can suggest unifying the terminology.

This type of automation not only saves time but also minimizes the risk of human errors. And this is just one example – AI also assists in generating documentation, writing tests, and optimizing performance, which we will discuss in upcoming articles.

Summary

Artificial intelligence is transforming the way frontend developers work daily. From generating components and refactoring code to detecting errors, automating testing, and documentation—AI significantly accelerates and streamlines the development process. Without these tools, we would lose a lot of valuable time, which we certainly want to avoid.

In the next parts of this series, we will cover topics such as:

Stay tuned to keep up with the latest insights!