XBRL US, the nonprofit consortium for the digital business reporting standard, together with blockchain startup ConsenSys, has announced the formation of a working group dedicated to developing standards for tokenization of assets on the blockchain.

XBRL aims to improve the accountability and transparency of business performance globally, by providing the open data exchange standard for business reporting. It is widely used around the world by public and private companies and governments to reduce the cost of reporting and collecting data and improve the quality of reported financial information.

A token is a digital representation of an asset – debt, equity, cash or a physical asset (i.e. a vehicle or a piece of artwork). The blockchain is a digital distributed ledger that records and facilitates transactions. The tokens are used on a blockchain to assign ownership and rights of underlying assets that are transacted through smart contracts on the blockchain.

“Blockchain is the future for financial products and financial transactions,” said Campbell Pryde, President and CEO of XBRL US. “Creating a standard method to tokenize transacted assets is necessary to communicate ownership and value. Without standardization, the speed, accuracy and automation promised by smart contracts on the blockchain, simply will not happen.”

The working group aims to establish a standardized method to represent a token across all blockchain networks in order to eliminate transactional friction and reduce processing costs; enable automation and provenance tracking; and allow interoperability of transactions on a global scale.

“We envision a future where all asset classes are tokenized, and act as bearer instruments that are facilitated and recorded on the blockchain,” expressed Griffin Anderson, Director for Blockchain Accounting at ConsenSys and founding member of the Accounting Blockchain Coalition.

According to the official release, the working group will establish goals and action steps by early 2017. It is requesting participation from individuals representing technology, finance, and accounting to provide their expertise in developing tokenization standards that can be used worldwide, for all asset classes.