On May 2nd, Facebook registered Libra Networks in Geneva, Switzerland. According to Reuters, Libra is a fintech company focusing on blockchain, payments, data analytics, and investing. Project Libra was first launched by Facebook over a year ago to allow money transfers between WhatsApp users. Since then the Libra project has expanded to include e-commerce payments both on Facebook and other websites, and online shopping.
Switzerland is fintech friendly
Fintech is shorthand for ‘financial technology’ and is a term used to describe computer programs and other technology used to support or enable banking and financial services.
In February of 2017 Switzerland began to proactively attract blockchain startups by reducing the market entry barriers to fintech. The country’s welcoming approach to fintech companies has helped Switzerland to be recognized as a leading hub for blockchain and cryptocurrency technology.
Zug, Switzerland, with a population of about 124,000 people, is referred to as “Crypto Valley” around the world. In 2018 residents used the city’s eID system to vote using their smartphones as part of a blockchain-based voting test. Zug is also home to numerous fintech startups such as Imbrex, a global community-owned real estate portal and data marketplace.
Real estate cryptocurrencies are attracting a lot of investor attention
Many real estate companies have begun using cryptocurrency and blockchain to improve the real estate industry. Blockchain in real estate removes barriers to access to capital through fractionalized investment, shortens the verification of ownership, and eliminates the costly need for title insurance and expensive escrow fees that steal profits from the hands of investors.
According to the leading blockchain industry news and crypto market analysis website CryptoSlate, there now a total of 16 real estate cryptocurrencies including:
- Menlo Park, CA based Propy, a global property store and decentralized title registry built on blockchain
- San Francisco based Rentberry, a decentralized ecosystem using blockchain technology to make the long-term rental process less costly, more convenient and secure
- Cherry Hill, NJ based Relex, an investment platform that uses cryptocurrency to provide transparency and accountability to real estate investment opportunities
Global real estate cryptocurrency projects
Around the world, real estate cryptocurrency projects have been quickly attracting attention from crypto investors, property investors, and real estate professionals. These are the top five real estate cryptocurrencies based on market cap, as reported by ICO Alert:
- LATOKEN: platform allowing investors to trade tokenized shares of Apple, Tesla, Google, and other blue ship stocks, in addition to gold, oil, and real estate ETFs. Current market cap about $23.9 million.
- Propy: a property store and asset transfer platform for the global real estate industry that serves as a way for home buyers to purchase property internationally. Current market cap about $23 million.
- REAL: short for ‘real estate asset ledger’, the platform is designed to reduce friction between buyers and sellers of real estate, improve liquidity, and lower the barriers to entry of investing in real estate. Current market cap about $6.4 million.
- ATLANT: the company hopes to take on Airbnb by tokenizing property ownership and facilitating global peer-to-peer (P2P) rentals. Current market cap about $6.1 million.
- REX: platform intended to become a global real estate data marketplace where data is sourced, validated, and secured with blockchain and smart contracts. Current market cap about $5 million.
Cryptocurrencies will disrupt the real estate industry
A recent article in Forbes describes how the real estate industry is the perfect sector for disruption and innovation through blockchain:
“The implications of blockchain for the real estate industry are enormous. Blockchain can make MLS property data more centralized and accessible, title records easier to track and transfer, and it can make transactions more efficient and secure.”
Globally speaking, real estate is a $217 trillion dollar market accounting for close to 60% of all global wealth. Although it’s the largest source of wealth, it is also illiquid for 99% of the world. Digital real estate tokens using blockchain technology will help to create an enormous amount of capital flow by:
- Offering fractionalized access to the best real estate around the world
- Allowing greater diversification of investment portfolios and increased risk management
- An alternative to historically volatile equities such as stocks and bonds
- Real-time real estate transactions with fewer and lower fees
- Lower investment amounts allow people from all income levels and social status to invest in real estate
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