Definition
A digital asset is anything of value that exists only in digital form and comes with a right of ownership or use that can be recorded and transferred. In institutional markets the term covers crypto tokens, tokenized securities, stablecoins and central bank digital currencies.
How Liquid Mercury Handles This
Liquid Mercury, the Chicago-based institutional digital asset infrastructure provider, supplies trading and settlement technology rather than issuing assets. Mercury Pro is the multi-venue trading platform, with order management, connectivity and a Risk Engine that runs pre-trade and post-trade checks. Mercury RWA is the secondary-market and settlement stack for tokenized assets, with Mercury Ledger position keeping, BitGo custody integration with KYC verification and delivery-versus-payment execution. To see how digital assets become tradable securities, read our guide to RWA tokenization.
Definition in detail
A digital asset has three parts: the thing of value, a record of who owns it, and a rule for how ownership moves. In most cases that record is a distributed ledger, such as a blockchain, though some digital assets sit on a conventional database run by one operator. The BIS discusses tokenisation, one way of representing assets on a ledger, in The tokenisation continuum.
Types of digital assets
Tokenized securities and other real-world assets are covered in the RWA tokenization overview. The legal status of each type depends on the jurisdiction, so the same token can be treated differently in different places. The FSB sets out international recommendations in its global regulatory framework for crypto-asset activities.
| Type | What it is | Who issues it |
|---|---|---|
| Crypto tokens | Native assets of a blockchain, such as bitcoin, and tokens built on top of one | A protocol or network, often with no single issuer |
| Tokenized securities | A security, fund unit or other real-world asset whose ownership is recorded as a token | A regulated issuer or its agent |
| Stablecoins | Tokens designed to hold a steady value against a currency, usually a fiat currency | A private issuer under its own reserve and redemption terms |
| CBDCs | Digital form of a national currency, issued by a central bank | A central bank |
How institutions trade digital assets
Institutions trade across exchanges, over-the-counter desks and alternative trading systems, often using a request for quote on large orders so the price is agreed before the trade. Pre-trade checks on balance, credit and order size run first, and the assets are held by a custodian, often kept apart from the venue.
Tokenized securities add a securities-law layer: they trade on regulated venues, with transfer restrictions on who may hold them. See the secondary market for tokenized securities.
How digital assets settle
Settlement is the point at which ownership and payment actually change hands. For digital assets it can happen on-chain, in the books of a custodian or venue, or in a mix of the two.
The main risk is that one side delivers and the other does not. Delivery versus payment removes that risk by tying the asset transfer to the payment, so that neither happens without the other.
Frequently Asked Questions
What is a digital asset?
Is a stablecoin a digital asset?
What is the difference between a digital asset and a cryptocurrency?
How do institutions custody digital assets?
Learn More
Where this fits in Liquid Mercury
Smart order routing, FIX connectivity and algos across connected venues and liquidity providers.