> For the complete documentation index, see [llms.txt](https://docs.atpar.io/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.atpar.io/sdk/tokenization.md). # Tokenization > Tokenization in ACTUS Protocol means that for a side of an ACTUS contract ownership in cash flows is represented through ownership of an Ethereum ERC-20 compatible token. > > Token holders receive a percentage of the cash flow, proportional to the fraction of the token supply they own. They can withdraw their balances at any time. Tokenization is optional. It usually makes most sense for the *Beneficiary* side of an asset (the side that will receive the principal and/or interest payments after the initial exchange, i.e. the loan amount, was paid). ACTUS Protocol makes use of an implementation of [ERC-2222](https://github.com/ethereum/EIPs/issues/2222) to efficiently distribute cash flows to token holders. ### Example Alice lends 100 DAI to Bob. Bob pays the DAI back over the course of 1 year. Each month he pays a percentage of the principal + interest. Alice is the beneficiary and tokenizes her side of the asset. She has multiple options: * She tokenizes all cash flow types of the asset together. For instance, she decides to issue 100 tokens. Each individual token represents exactly 1% of the future cash flow of the asset (principal payments + interest payments). * She tokenizes interest payments and principal payments separately. 100 Principal Tokens and 100 Interest Tokens are created, each representing 1% of the respective cash flow type. Let's assume the latter case. Now Alice can sell the principal & interest tokens individually on an ERC-20 compatible market. Potential buyers can look at the underlying asset and price the tokens according to the outstanding cash flow and their individual risk assessment. ### Workflow * Deploy a token contract, e.g. an ERC-2222 or just an ERC-20 contract * Set the contract's address as the beneficiary of an asset * Issue the asset By default all cash-flows are included when an asset is tokenized. --- # Agent Instructions This documentation is published with GitBook. GitBook is the documentation platform designed so that both humans and AI agents can read, navigate, and reason over technical content effectively. Learn more at gitbook.com. ## Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. Perform an HTTP GET request on the current page URL with the `ask` query parameter: ``` GET https://docs.atpar.io/sdk/tokenization.md?ask= ``` The question should be specific, self-contained, and written in natural language. The response will contain a direct answer to the question and relevant excerpts and sources from the documentation. Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.