DIGITAL ASSETS: FOR THE NEWBIES!
Have you ever heard of Bitcoin, Litecoin, Ethereum, XRP, and wonder what they are? Have you heard of people talking about Bitcoin Price, and what does that mean? Cyrptocurrency news and cryptocurrency prices are heavily talked about in today's financial BTC news! Do you even wonder what BTC news is? Let's start with the basics first, before you get overwhelmed.
What is a Digital Asset?
Assets are valuable resources that countries, corporations, and individuals control or own with the expectation of future benefits. Assets are typically reported on corporate balance sheets and are created or bought to improve a firm’s position. Assets are best thought of as things that can reduce expenses, generate cash flow, or boost sales. In this guide, we’ll discuss a few types of assets.
Current Assets
A current asset is a short-term economic resource that will be liquidated (converted to cash) within a year. This group includes accounts receivable, cash and equivalents, prepaid expenses, and inventory.
While it’s easy to value cash, accountants occasionally reassess the recoverability of accounts receivable and inventory. If these assets are unrecoverable, they’re said to be impaired; if inventory is obsolete, it may be written off.
Fixed Assets
A fixed asset is a long-term resource such as a building or a piece of equipment. Aging-related adjustments are made based on depreciation, which might reflect a fixed asset’s diminished earning power.
Accounting principles allow for depreciation under two methods. The accelerated method assumes a steeper decline in value within the first years of use, while the straight-line method assumes that fixed assets lose value proportionate to their useful lifespan.
Financial Assets
A financial asset is an investment in other institutions’ securities and assets. This category includes corporate and sovereign bonds, stocks, and hybrid securities. These assets are valued according to the investment’s classification and the reasoning behind it.
Intangible Assets
An intangible asset is an economic resource without a physical presence. This group includes goodwill, copyrights, trademarks, and patents. The accounting process for these assets differs depending on their type, and intangible assets may be amortized by the year.
Digital Securities
A digital security is a digital representation of a security such as an investment contract, where ownership is recorded on distributed ledgers. Digital securities are subject to the same laws as other securities are, and they’re sometimes known as security tokens. These securities may represent part of a debt security or a note, a share of stock, or a fractional interest in assets such as ETFs, artwork, or real estate.
What’s the Difference Between Cryptocurrency and Digital Assets?
While many believe that cryptocurrency has no real value, digital assets have intrinsic value. An asset’s intrinsic value is based on the underlying perception of its true value in terms of intangible and tangible factors, and it may be different from the asset’s market value.
What is a Digital Asset?
Assets are valuable resources that countries, corporations, and individuals control or own with the expectation of future benefits. Assets are typically reported on corporate balance sheets and are created or bought to improve a firm’s position. Assets are best thought of as things that can reduce expenses, generate cash flow, or boost sales. In this guide, we’ll discuss a few types of assets.
Current Assets
A current asset is a short-term economic resource that will be liquidated (converted to cash) within a year. This group includes accounts receivable, cash and equivalents, prepaid expenses, and inventory.
While it’s easy to value cash, accountants occasionally reassess the recoverability of accounts receivable and inventory. If these assets are unrecoverable, they’re said to be impaired; if inventory is obsolete, it may be written off.
Fixed Assets
A fixed asset is a long-term resource such as a building or a piece of equipment. Aging-related adjustments are made based on depreciation, which might reflect a fixed asset’s diminished earning power.
Accounting principles allow for depreciation under two methods. The accelerated method assumes a steeper decline in value within the first years of use, while the straight-line method assumes that fixed assets lose value proportionate to their useful lifespan.
Financial Assets
A financial asset is an investment in other institutions’ securities and assets. This category includes corporate and sovereign bonds, stocks, and hybrid securities. These assets are valued according to the investment’s classification and the reasoning behind it.
Intangible Assets
An intangible asset is an economic resource without a physical presence. This group includes goodwill, copyrights, trademarks, and patents. The accounting process for these assets differs depending on their type, and intangible assets may be amortized by the year.
Digital Securities
A digital security is a digital representation of a security such as an investment contract, where ownership is recorded on distributed ledgers. Digital securities are subject to the same laws as other securities are, and they’re sometimes known as security tokens. These securities may represent part of a debt security or a note, a share of stock, or a fractional interest in assets such as ETFs, artwork, or real estate.
What’s the Difference Between Cryptocurrency and Digital Assets?
While many believe that cryptocurrency has no real value, digital assets have intrinsic value. An asset’s intrinsic value is based on the underlying perception of its true value in terms of intangible and tangible factors, and it may be different from the asset’s market value.
The Blockchain
A blockchain is a wide computer network that verifies the data within a digital ledger. Though blockchain tech didn’t affect the significance of digital assets, it did broaden the terminology. Today’s digital assets, such as cryptocurrencies, can disrupt the industrial world.
The blockchain brings more transparency to the world, allowing people to document aspects such as the authenticity, ownership, location, and transaction history of a digital asset. Therefore, the blockchain has ushered in a new era of bilateral exchange.
The Advantages of Digital Asset Ownership
All digital assets offer value, but they’re not all valued in the same way. Some assets are irreplaceable because their value is far more than the cost of their creation. Think of all those once-in-a-lifetime event videos and photos. These assets are more valuable to individuals and companies than those that can potentially be replicated with effort, time, and money.
Take stock photos for instance. While most stock photos require the payment of a licensing fee, it’s easy to find alternative options if you can’t find the right photo. A lengthy digital manual for a software program, with its range of content, is harder to recreate and is therefore more valuable.
Today’s companies use digital assets to increase brand awareness and influence customers’ purchase decisions. A digital asset is a visual representation of a company’s services and products, and they allow companies to engage and connect with their target audiences in various ways. From a company’s advertising copy to its logo, digital assets are the firm foundation upon which corporate brand identities are built.
Digital Asset Management
Because they’re highly identifiable, digital assets are discoverable and searchable. However, an efficient DAM system streamlines the process. While most users have ways to store and manage their digital assets, basic filing systems cannot accommodate the wide range of digital assets used by most companies.
Today’s corporations invest significant resources, money, and time into the creation of digital assets. However, the only way to get the most value out of these assets is to ensure that they can easily be located.
Why I am here and What I am telling you!
Many find it difficult to understand the value of digital assets as they’re binary and intangible, which leads them to believe they lack intrinsic value. However, digital assets are just as valuable as tangible assets, as they help companies build brand awareness and increase sales.
A blockchain is a wide computer network that verifies the data within a digital ledger. Though blockchain tech didn’t affect the significance of digital assets, it did broaden the terminology. Today’s digital assets, such as cryptocurrencies, can disrupt the industrial world.
The blockchain brings more transparency to the world, allowing people to document aspects such as the authenticity, ownership, location, and transaction history of a digital asset. Therefore, the blockchain has ushered in a new era of bilateral exchange.
The Advantages of Digital Asset Ownership
All digital assets offer value, but they’re not all valued in the same way. Some assets are irreplaceable because their value is far more than the cost of their creation. Think of all those once-in-a-lifetime event videos and photos. These assets are more valuable to individuals and companies than those that can potentially be replicated with effort, time, and money.
Take stock photos for instance. While most stock photos require the payment of a licensing fee, it’s easy to find alternative options if you can’t find the right photo. A lengthy digital manual for a software program, with its range of content, is harder to recreate and is therefore more valuable.
Today’s companies use digital assets to increase brand awareness and influence customers’ purchase decisions. A digital asset is a visual representation of a company’s services and products, and they allow companies to engage and connect with their target audiences in various ways. From a company’s advertising copy to its logo, digital assets are the firm foundation upon which corporate brand identities are built.
Digital Asset Management
Because they’re highly identifiable, digital assets are discoverable and searchable. However, an efficient DAM system streamlines the process. While most users have ways to store and manage their digital assets, basic filing systems cannot accommodate the wide range of digital assets used by most companies.
Today’s corporations invest significant resources, money, and time into the creation of digital assets. However, the only way to get the most value out of these assets is to ensure that they can easily be located.
Why I am here and What I am telling you!
Many find it difficult to understand the value of digital assets as they’re binary and intangible, which leads them to believe they lack intrinsic value. However, digital assets are just as valuable as tangible assets, as they help companies build brand awareness and increase sales.
