Real World Asset Tokenization on Hive, Part 2

in RWA2 days ago

Process: Tokenization of real estate property on Hive

  • tokenization of real world assets require that ownership of the property be held by a smart contract, on the blockchain, where the ownership of the asset is held.
  • Such tokens become shares representing ownership of a fraction of the aset.
  • These shares of ownership of the tokenized property are represented by cryptocurrency tokens, which can be called NFTs.
  • There is normally a single mint of these tokens and no other mint possible.
  • The minted tokens represent an ownership share in the asset.
  • These cryptocurrency NFTs can be bought and sold like other tokens on the blockchain they are minted on, and held in wallets on that blockchain
  • Anyone, anywhere in the world, can create a wallet on that blockchain, use their countries fiat or some other fiat to purchase the blockchains stablecoin and use it to purchase these tokens representing an ownership share in the tokenized real estate property.
  • All token purchases and sales are done on the blockchain at exchanges on that blockchain where the tokens are listed for sale.
  • All tokens are held in purchasers wallets.
  • All tax benefits from real estate ownership can be distributed to token owners quarterly, according to terms dictated in the smart contract creating the tokens.
  • There are other details regarding the tokens dictated by the property owner at the begininng of the tokenization process and dictated by the tokenizer.
  • This would require deployment of smart contracts on Hive making these conditions possible.
  • Alternatively, wrapped versions of hive tokens cold be traded on another blockchain where smart contracts are already deployed. usch as Ethereum.

Purpose

  • Tokenization allows real estate asset holders to access the monetary value or equity of their home without incurring a second mortgage or selling the property.
  • This also allows investors to invest in real estate assets and benefit from the normal appreciation of such assets with relatively small investment amounts. For example a typical 100,000 USD property normally requires a 20,000 USD down payment and then monthly loan payments for the 80,000 USD balance. but with tokenization the same investor can own a percentage or share of the same property for as little as 1000 USD. Additionally, this allows an investor with 20,000 USD to invest to diversify their investments by investing in 20 different properties at 1000 USD each, versus one property for 20,000 USD. lastly, this property can be listed on a real estate sales market site on the cryptocurrency exchange of a blockchain, which allows investors from all over the worl, not just one city, or one country to see the property and invest in it. This greatly enlarges the market for such property.
  • Tokenization allows many different types of investors to invest in assets which both retain their value and appreciate each year. This is an effective hedge against inflation no matter where you live, and allows access to markets to global investors wthey would otherwise not have access to in traditional real estate sales systems.
  • Lastly tokenization provides transparency of title, ownership, terms, purchases and sales.

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You have really analyzed the advantages of tokenization. Thank you for the in