It's a subject that i've looked into in the past and one that i feel is an undervalued use case of blockchain and crypto. In amongst all of the fads, scams and memecoins we all know that crypto has so many use case that it's just a matter of time and development before the wider population is using it without needing to know what is going on in the background.
It think that there are a lot or real business use cases that haven't been fully explored or built on yet. One that i can see having a big impact over the next decade is the tokenization of real estate.
If i have 10k in the bank is a savings fund for the future. I will want that money in 20 years to retire on and plan to keep adding to it over the year.
The problem as we all know is that money only loses value over time. That money sitting there is a huge waste and in 20 years time might not even have half the buying power that it does today, if even the way things are moving.
The other problem is that it is very hard to make a return on that money. My best savings option in the bank is 2% APR. Again on money that is losing value while it sits there earning tiny sums. Sums which are then taxed. Stocks aren't a great option here as our laws discourage it. Crypto is risky and most people don't want to put money into it even if they can figure out how to do it.
As a traditional investor I want something that is low risk, easy to get into and that can outpace inflation.
For that, I would love to buy some property and rent it out for income. Property that as a rule goes up in value over time while earning returns as it does. A great investment in this country.
The drawback now being that I can't afford property with just 10K and would need to save up a lot more as well as link in with the banks to get another mortgage and take on debt to make money.
Tokenizing property.
Imagine creating a business.
- A company that creates a token.
- All funds raised from people buying the token is pooled and used to buy property.
- That property is rented out.
- After running costs and other reductions,
Profits are paid out monthly to the token holders who funded these purchases.
Your 10K dollars purchased 10K property tokens. Every month those tokens entitle you to $100 deposited into your property wallet.
this money can be used to buy more tokens and compound your investment or withdrawn to your bank account.
The token is backed by real life properties.
The token can be bought or sold in the app.
They could release a new token per property or one token that works across the whole portfolio.
You can
Real estate tokenization seems like it will significantly contribute to this growth. The market size for real estate tokenization was $2.7 billion in 2022, and its growth trajectory indicates that it could reach $16 trillion by 2030 according to a report by the Boston Consulting Group.
Ref: Forbes
There is definitely a great business model in here somewhere and a profitable one for the person who can organise it, develop it and make it user friendly.
I wish that i was the guy to make it happen but i would be very surprised if somebody doesn't in the next decade.
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Honestly, I don’t see 2% APR as a good investment
I feel it is too little or maybe I’m not contented
Interesting crypto model, but could the token holders ever own the real estate or is it just, in effect, a share of rental properties?
Tokenisation of asset is actually a great business model but my fear is it is also risky
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Bank deposits becoming the RWA tokens and stored in the bank that would be another good use case. This way they can eliminate the papers and the bank employees tampering with data is going to get fixed.