Real Estate Business Gets Blockchainized
It’s been nine years since Bitcoin white paper was first published, but it still echoes across different industries. The concept of blockchain was accepted and embraced by serious institutions like major banks or international corporations.
Even though cryptocurrencies still have a long way to go in terms of universal acceptance, it’s been different for the blockchain. It’s attack resistance and immutability appealed to entrepreneurs of various backgrounds, from IT to the video games industry.
The Next Step in the Evolution
With the introduction of smart contracts a few years ago, the technology has taken a quantum leap to the future. Thanks to them, the entire relationship between parties can now be regulated in an automatic and pre-determinedly fair way.
This ushered the next wave of blockchain-inspired advancement; tokenization. It is a way to represent real-life values of literally any nature in the form of digital tokens.
Certain industries have already embraced the concept of tokenization. Video games industry was among the first to do so, which stems from the fact that monetary relations within games are a perfect match for the model of digital tokens. Another notable example is government services that gradually introduce blockchain-powered solutions to their operation.
However, this trend involves much more than eSports and public service. There are numerous projects that develop platforms for tokenization of real estate assets, both preexisting and those under construction.
Tokenization in Real Life
One of them is XRED, a platform enabling anyone to invest in new construction projects in London. With one of tokenization’s advantages being the lack of sky-high entry thresholds, anyone can buy as many tokens as they like, and those tokens would entitle them to own a respective share of the future real estate.
A somewhat similar model is offered by Propy, a project currently working in California but seeking to expand elsewhere a little ways down the road. This, however, is not an entirely investment platform; it is a decentralized real estate marketplace and a land title register. The platform uses Ethereum smart contracts to enable all parties involved in real estate transactions verify their deals under the prevailing legislation.
Finally, there is BitProperty, which is a real estate investment platform that is not limited to a certain location and allows everyone to purchase real estate assets anywhere in the world. One of its most peculiar features is the fact that its tokens are backed by the power generated by a Japan-based solar farm owned by the company.
By tokenizing real estate, those companies and their peers open the gate for regular people who have never had an option of actually investing in this area before. As the amount of investment is not limited from either side, one can spend just $100 to buy a fraction of an apartment, and then sell the tokens that represent it when the price goes up.
However, speculation isn’t everything; thanks to smart contracts, real estate agents, customers, contractors and any other party involved in the business may finally have a guarantee that everything goes as planned.
The appeal of blockchain isn’t about security or transparency, after all. Most importantly, it is about building a more reasonable and comfortable environment for everyone. And, as it seems, the process is already underway.