UPSC Prelims 2026 · GS Paper 1 · Question 91
Which of the following statements about Real-World Assets (RWA) Tokenization are correct? 1. Tokenization is the process of turning real world assets into digital tokens using blockchain technology. 2. Tokenization of real world assets offers 24 x 7 access, promoting financial inclusion. 3. Tokenization of real world assets will allow the access to high growth investment opportunities for individuals in India. Select the answer using the code given below :
Correct answer: Option A
Economy
Options
- (a) 1, 2 and 3
- (b) 2 and 3 only
- (c) 1 and 2 only
- (d) 1 and 3 only
Detailed solution
Answer
Option (A) — 1, 2 and 3
Explanation
- Real-World Asset (RWA) tokenization refers to converting ownership rights of physical or traditional financial assets (like real estate, commodities, bonds) into digital tokens on a blockchain.
- Blockchain-based tokenization enables 24x7 trading and access, unlike traditional markets with fixed hours, thereby promoting financial inclusion by lowering barriers to entry.
- Tokenization allows fractional ownership, which means individuals in India who could not previously access high-value investment opportunities (like commercial real estate or fine art) can now invest small amounts, opening up high-growth investment avenues.
Statement Analysis
- 1. Tokenization is the process of turning real world assets into digital tokens using blockchain technology: Correct. This is the standard definition of RWA tokenization.
- 2. Tokenization of real world assets offers 24x7 access, promoting financial inclusion: Correct. Blockchain operates round the clock without market hours, and fractional ownership lowers entry barriers.
- 3. Tokenization of real world assets will allow access to high growth investment opportunities for individuals in India: Correct. Fractional ownership through tokenization democratizes access to previously exclusive asset classes.