A major move is taking place. It is vital we keep pointing this out. There is a lot of FUD in the air due to the bear. This means that everyone, including the financial media jumps on.

However, we do have a lot of positives. We are heading towards the tokenization of everything. Over time, we are going to see more aspect of our financial world becoming converted to tokens.

For this reason, everyone who is involved as an early adopter should be excited.

Be willing to pay the price to reap the rewards.

The Tokenization of Real Estate

Many wrote over the years about the tokenization of real estate. This is a market that is ideally suited for cryptocurrency. Due to the high costs, it is an exclusionary field. At the same time, liquidity is a major problem.

Tokens solve both of these issues. By "digitizing" the ownership of real estate, transference is much easier. Suddenly, selling an asset of this nature is akin to moving stock.

This is exactly what is taking place in the UK.

United Kingdom-based property developer Knight Dragon has announced the launch of the first property tokenisation project in London with a valuation of £140 million.

This is going to be an income token of sorts, with each entitling the holders to a portion of the proceeds.

Moreover, the statement indicated that KD Tokens has already minted tokens (KDB4 ), with holders expected to share 80% of the project’s gross profit. Based on the project’s legal documents, the tokens will act as securities for the holders.

If successful, this is going to be the first of many projects for this company.

According to the company’s founder, Sammy Lee, based on the London property success, there are plans to expand to other regions globally as a means of improving property ownership.

According to the founder:

“In the same way an asset can be securitised by dividing it into shares, tokenisation allows an asset to be divided into individual tokens. The tokens represent a specific share of an underlying asset. In this case, ownership of KDB4 Tokens will represent a fractionalised interest in a contractual right to share in the gross profit of Building 4,” said Lee.

This is exactly what people discussed regarding real estate tokenization. We are seeing the ownership split into "shares" and can be held by people all over the world. The revenue stream generated from rents will be distributed to the token holders, providing a ROI. Of course, we can expect, if this takes off. a secondary market to open up whereby the tokens can be sold.

There is, however, another aspect to this. These token effectively operate as an access token.

Furthermore, all KDB4 token holders are eligible to be given priority for future Knight Dragon investments on the Greenwich Peninsula.

Source

So if you are in on the first deal, you will be offered priority access on other deals. This is a pretty good, well, deal.

Creative Juices

We can see how the creative juices can really get flowing.

For example, what about the equity in these buildings? Who owns that? How is that being captured?

In this instance, the company could sell another set of tokens that simply captured equity value. If the building is sold, the token holders are paid out according to the sales price. Naturally, one would hope the value went up over the years.

This would not affect the income tokens since they would be paid as long as the building was owned under this format. That said, it could be in the sales contract that the purchaser, in the future, is buying equity only.

Ultimately, what we are seeing is the fractionalizing of most everything. This is what cryptocurrency offers the world. Everything will have a tradeable market, although not all will have liquidity. Nevertheless, many assets that are presently non-liquid, such as real estate, could have that instantly granted.

This is a project to keep an eye on to see how it progresses. We could be watching the future emerge before our eyes.

Image from article linked.

Article by @taskmaster4450le.

Posted Using LeoFinance ^Beta