What are Security Tokens and how are they changing the future of investing?

Like many financial assets and services, real estate is one limited by its dependence on legacy systems. The emergence of decentralized systems via blockchain technology is injecting industries — including real estate, accounting and trade networks — with several groundbreaking changes that benefit all involved stakeholders. From requiring one’s physical presence and considerable resources, we are now moving into an age where accessibility and inclusivity are priorities.

The fundamentals of the technology has evolved to persuade individuals from all industries that the technology has remarkable potential to it. Entrepreneurs, lawmakers, now ex-traditional banking professionals and even the big monopolies believe that the technology could usher in a severe change in the way we interact with each other. The capability of Distributed Ledger Technologies (DLTs) to form direct lines of interaction between consumers and producers/service providers is undoubtedly a game-changing development. These individuals can now band together to fund ideas, products and services they believe, with each getting an equal share of the reward. This «tokenization of assets» has become a major focus for the cryptocurrency space, and start-ups have applied the technology to a varied group of real world assets, including art, gold and real estate. The last of those is at the heart of CROWDLITOKEN. Real estate, one of oldest and enduring forms of investment, has been the target of cryptocurrency startups for some time now and it’s evident why. The industry is fraught with difficult negotiations, contractual validations and tedious paperwork. Furthermore, real estate has long been a form of investment accessible to only the elite. With the power of crowds inherent in decentralized systems, that is about to change.

Lowering the Entry Barrier in Real Estate Investment Through the Power of Crowds

CROWDLITOKEN’s platform tokenizes the expensive asset of real estate. In simpler words, it means that anyone can purchase a fractional part of the security, and thus not have to spend a large sum for the entire property.

This is in keeping with the ability of Distributed Ledger Technologies to redistribute power — anyone can own a specific portion in some of the most sought-after properties in the world. A family, or any community really, could come together to purchase a property. This makes the asset a more affordable purchase, while also giving them all an equal level of profit. Given the value of the real estate market, which numbers at hundreds of trillions of dollars, the permittance of tokenized purchases of properties, at affordable prices, gives investors who have hitherto been unable to access the market a fantastic way to realize immeasurable gains. It also is the case that the average investor is limited to purchasing a few properties, given that it is a large expense and so time consuming. But with the latter problems out of the way, users can also utilize the feature of tokenized purchases to diversify their property portfolio and manage risks. The digitization of all of these aspects remove the need for lawyers, agents and others — making it further affordable. CROWDLITOKEN’s most valuable feature is that users can earn a profit even if they make a small purchase of property (which they can also reinvest). This is contrary to how it is today with largely unaffordable land or property.

Real Estate to Be Revolutionized

The validation of real estate transactions through digital means is a striking evolution for the industry – it is still a very much local thing, long overdue a refinement. We finally have a technology that can make convenient the process from end to end, from the dreadful task of searching for a suitable property to the exhausting paperwork at the end. There are several examples of how the technology can make things better: documents can be signed online, and titles and documents accessed. Smart contracts make it possible for immutable data to be recorded. All of this is also transparent on the ledger and can be programmed to execute when certain conditions are triggered. This last point is what helps in «disintermediation» that is often talked about — the middlemen who incur fees for their service involving contracts. Enhancement of a traditional asset class is precisely what CROWDLITOKEN does, letting users buy, sell and discover new investments with nothing more than a few clicks and the lightest of administrative work. If that doesn’t showcase the brilliance of blockchain, then nothing will.

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