The tokenization being talked about is minting digital tokens in a public blockchain to represent traditional assets.

Unlike decentralized cryptocurrencies, this blockchain is not decentralized and participating requires creating a wallet and having it whitelisted by a centralized controlling entity.

Some form of identification, KYC/AML process has always been required to be an investor or non-trivial financial transactions.

The benefits of tokenization over the traditional approach are fractional ownership, faster settlements and transfers, 24/7 market, etc.