How do you prove you own the physical asset you are collateralizing? How do you prove you will have future earnings to borrow against? Do we use the existing

How do you prove you own the physical asset you are collateralizing? How do you prove you will have future earnings to borrow against? Do we use the existing systems (legal, credit score, etc) or something new? I'm genuinely curious, I don't know much about cryptocurrencies.