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Tokenized property is still a niche market, mainly due to its relative novelty and regulatory uncertainty.However, a new report points out that even if 0.5% of the global real estate market is tokenized in the next five years, it is expected to become a $1.4 trillion market
In recent years, the total value of the global real estate market has reached a staggering US$280 trillion, surpassing most other major asset classes, and equal to the total global debt accumulated by 2020. Moore Global, an international consulting firm and accountancy network born in London, released a report summarizing the opinions of global experts on the tokenization potential of this booming asset class (if traditionally lacking liquidity).
For Dan Natale, the real estate and construction leader of Moore Global and the managing partner of Toronto Segal LLP, the main benefit of blockchain to the industry is to support the new secondary market by providing efficient, disintermediate infrastructure. Improve liquidity. David Walker, the managing partner of Moore Cayman, is an auditor who specializes in digital assets. He claims that the transparency and security of the technology also provide clear advantages from the auditor’s perspective.
So far, the expansion of real estate tokenization has not met expectations, partly due to the hesitation and lack of mature institutional investors Secondary market for securities token tradingHowever, this may gradually change, the UK Financial Conduct Authority grants Business license for digital securities trading Archaz last August.A year ago, the German Federal Financial Supervisory Authority (BaFin) approved its first Blockchain-based real estate bonds, Issued on Ethereum.
related: Tokenized real estate lives up to the hype: real estate researcher
Andrew Baum, director of the Real Estate Future Plan at Oxford University’s Said School of Business, believes that if there is evidence of investor demand for partial ownership, the tokenization of real estate may eventually take off-tokenization advocates have already Champions since 2017.
Last summer, the security token representing part of the ownership of the luxury St. Regis Aspen Resort in Colorado went online on Overstock’s regulated tZERO exchange. Attract record trading volume. However, in less than a month, with Token performance is relatively flat In the context of the slowdown of the coronavirus, investors received substantial discounts on resort accommodations to help boost token sales. Despite this, tZERO recently established a partnership to tokenize the $18 million NYCE Group stock-the platform was hyped as a potential “Robin Hood. “
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