Tokenization reduces costs in several ways:

1. _Automated processes_: Tokenization automates many administrative and operational tasks, reducing labor costs and increasing efficiency.

2. _Reduced intermediaries_: Tokenization eliminates the need for intermediaries, such as banks and brokers, reducing transaction costs.

3. _Lower settlement costs_: Tokenization enables faster settlement times, reducing the costs associated with prolonged settlement processes.

4. _Reduced custody costs_: Tokenization eliminates the need for physical storage and custody, reducing costs associated with securing and maintaining assets.

5. _Lower regulatory costs_: Tokenization provides a clear and transparent record of transactions, simplifying regulatory compliance and reducing associated costs.

6. _Reduced marketing costs_: Tokenization enables direct communication with investors, reducing marketing and advertising costs.

7. _Increased scalability_: Tokenization enables businesses to scale more efficiently, reducing costs associated with growth.

8. _Reduced counterparty risk costs_: Tokenization reduces the risk of counterparty default, eliminating the costs associated with mitigating this risk.

By streamlining processes and reducing intermediaries, tokenization leads to significant cost savings, increased efficiency, and improved profitability for businesses and investors alike.