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February 10, 2023

3 Problems with Digital Asset Data Normalization

Digital asset data normalization refers to the process of standardizing digital assets into a common format. This process is important in ensuring that digital assets can be effectively managed, shared, and reused across various platforms and systems. Despite its significance, digital asset data normalization comes with several challenges that need to be addressed. In this blog, we will be discussing three of the most pressing problems with digital asset data normalization.

Problem #1: Lack of Consistency in Data Formats

One of the biggest challenges faced when it comes to digital asset data normalization is the lack of consistency in data formats. Different systems may use different data formats, and even within a single system, there may be variations in the way data is recorded and stored. This can lead to difficulties in exchanging data between systems, and it can also make it difficult to properly manage and maintain digital assets.

For example, a digital asset management system may use a certain data format, while a different system may use a completely different format. This can result in data incompatibilities, which can make it challenging to effectively manage digital assets. Additionally, the lack of consistency in data formats can also make it difficult to automate the normalization process, as different systems may require different normalization techniques.

Problem #2: Data Quality and Accuracy Issues

Another major challenge with digital asset data normalization is the issue of data quality and accuracy. Digital assets can be sourced from various systems, and the data that is stored in these systems may be incomplete, inconsistent, or simply inaccurate. This can result in significant problems when it comes to normalizing digital asset data.

For instance, digital asset data that is inaccurate or incomplete may result in incorrect data being stored in a centralized digital asset management system. This can lead to problems in retrieving the correct data when needed, and it can also result in significant inefficiencies when it comes to managing digital assets. Additionally, incorrect data can also result in incorrect analysis and reporting, which can have significant business impacts.

Problem #3: Data Privacy and Security Concerns

Finally, digital asset data normalization also raises significant data privacy and security concerns. When digital assets are centralized, there is a risk that sensitive data may be exposed. This can include information such as personally identifiable information (PII), financial data, and other sensitive information.

Moreover, there is also the risk of data breaches or unauthorized access to digital asset data. This can result in significant consequences, such as data theft, identity theft, and financial losses. It is essential that appropriate data privacy and security measures are in place when normalizing digital asset data.

In conclusion, digital asset data normalization is an essential process for managing, sharing, and reusing digital assets. However, it is not without its challenges, including the lack of consistency in data formats, data quality and accuracy issues, and data privacy and security concerns. To effectively address these challenges, it is important to implement appropriate data management practices, to ensure that digital assets are properly managed and maintained, and to implement appropriate data privacy and security measures to protect sensitive information.

By understanding and addressing these challenges, organizations can effectively normalize their digital asset data, which can result in improved digital asset management, more efficient data exchange, and reduced risks associated with data privacy and security.

Jacques Potts - Sr. Marketing Manager at Ledgible and experienced financial author, marketer, and crypto expert. His work has been featured on The Street, Project Serum, FirstTrade, and Invstr.
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