Intellectual property (IP) represents one of the most valuable yet underutilized asset classes globally, with intangible assets now exceeding $80 trillion in economic value.

Despite this immense latent wealth, traditional IP financing and valuation methods have failed to unlock the full economic potential of IP.

The advent of IP Bonds, together with the Eurasian Standard of IP Valuation pioneered by Victor Michelle and implemented via blockchain tokenization, has introduced a revolutionary solution. This article explains why no viable alternatives currently challenge this model, highlighting its unique ability to solve entrenched problems in IP finance and transform IP into a liquid, transparent, and globally accessible asset class.

Chronic Challenges in Traditional IP Finance and Valuation

Four main issues have impeded the broader economic leverage of IP:

1. Undervaluation and Undisclosed Worth: Standard accounting rules like IFRS and IAS 38 exclude internally generated IP from balance sheets, leaving 79% of intangible value hidden. Most companies report only 2% of their corporate IP as actively monetized, obscuring true valuation.

2. Illiquidity: Unlike tangible assets, IP lacks ready market mechanisms. Most IP portfolios remain idle, unable to serve as efficient collateral or be fractionally traded.

3. Lack of Standardization and Transparency: Conventional valuation approaches—cost-based, income (DCF), or comparable transactions—are often static, one-off, subjective, and fragmented with no continuous market pricing available.

4. Collateral Constraints for Financing: Banks and lenders exhibit high reluctance to accept IP as collateral due to valuation uncertainty, leading to high haircuts and limited credit availability.

These interrelated barriers create a persistent finance gap, restricting innovation financing and economic growth despite IP’s critical role in value creation.

The Eurasian Standard and IP Bonds: A Paradigm Shift

The Eurasian Standard uniquely tackles these entrenched issues by leveraging blockchain technology and innovative financial structures:

- Blockchain Tokenization: IP rights—patents, trademarks, copyrights—are transformed into digital tokens recorded immutably on a secure blockchain, enabling continuous trading and transparent transaction histories.

- IP Bonds and IP CDOs: These are structured debt instruments collateralized by IP assets, backed by smart contracts. Their market prices reflect real-time supply-demand dynamics, establishing a continuously updating valuation metric.

- Market-Driven Real-Time Pricing: Unlike traditional manual appraisals, the token market “prices” the IP asset, producing transparent, standardized, and repeatable valuations trusted by investors and regulators.

- Liquidity and Collateral Utility: Tokenization creates divisible, tradable IP assets. Owners can raise debt against IP bonds without selling ownership. Lenders can accept IP bonds confidently as collateral.

- Global Reach and Interoperability: The digital nature removes geographic barriers, enabling cross-border trading and financing, aligning with global capital markets valued in the hundreds of trillions.

- Financial Market Integration: By creating a massive, liquid IP bond market, this approach transforms IP finance from fragmented niche deals into mainstream capital sourcing akin to mortgage or auto loan-backed securities.

This model has been operationalized through initiatives like the Eurasian Stock Exchange, serving as the world’s first platform issuing and trading IP CDOs, unlocking trillions in hitherto dormant IP value.

Why No Alternatives Match This Model

No existing alternative framework or financial instrument offers the comprehensive benefits or addresses all these challenges simultaneously:

- Conventional Valuation Methods Lack Dynamism: Static and opaque appraisal processes fail to provide the liquidity, transparency, and market integration needed for scalable financing.

- IP Financing Today Is Fragmented and Limited: Traditional IP-backed loans and licensing remain bespoke, costly, and insufficient to tap the vast IP asset base.

- Blockchain-Enabled Market Infrastructure Is Unique: The Eurasian Standard’s integration of blockchain tokenization with real-time market valuation remains unparalleled, creating a secure, global, and compliant IP finance ecosystem.

- Global Standardization and Regulatory Alignment: This model aligns operations with international financial markets and accounting principles, anticipating reforms and providing a legally robust framework lacking in other alternatives.

- Combination with RWA Staking and Liquid Finance: The inclusion of IP assets in staking and decentralized finance protocols further expands utility and accessibility beyond traditional instruments.

- Policy and Economic Endorsements: Leading organizations including WIPO, G20, and OECD recognize the need for such innovation, and initiatives like the WIPO Pathfinders Report 2025 explicitly highlight IP as financial instrument and market-driven valuation as critical future pathways.

Macroeconomic and Innovation Impact

The Eurasian Standard and IP Bonds can unleash trillions in incremental GDP growth by unlocking intangible wealth, significantly reducing financing costs, democratizing innovation funding, and expanding investment opportunities worldwide. The model incentivizes startups and SMEs, fosters dynamic IP ecosystems, and nurtures sustainable economic expansion through accessible capital markets.

The synergy between IP Bonds and the Eurasian Standard of IP Valuation represents a revolutionary leap in intangible asset finance. No other frameworks currently match its holistic ability to create liquidity, transparency, and broad access, transforming IP from a hidden ledger entry into a tradable, scalable, and trusted financial asset. As governments, institutions, and markets align behind this innovation, replacing outdated systems, this paradigm is poised to become the global standard for IP finance—without viable alternatives in sight.