At this moment, we have digital cryptocurrencies on the blockchain such as Bitcoin or Ethereum. Besides that, we can put on the blockchain as well the fiat currencies, which then become so-called stablecoins, a stable digital currency. As we can go further, we can now digitalize precious metals such as gold or silver.
If we go a bit beyond those limits, now there is a possibility to tokenize real estates as well. With Algorand and AssetBlock it's possible.
Real estate nowadays
Real estate is way much largest asset class in the world. But due to that, most of the real estate market is actually controlled by institutional investors or in other words, large funds and banks. The majority of real estates are residential properties. Because real estate is so huge and important market, it is also most impacted by the international economy and global monetary conditions. Surely blasted by coronavirus pandemic situation all around the world.
Due to these facts, real estate has many issues that might concern the individual investor. The most important ones are those:
- High entry barriers, because of that it is merely a field of interest for the richest where the middle class and lower class has very limited chances to came in
- Middlemen involving, which makes the fees of transactions more expensive
- Transaction speed, which makes this market less liquid than the other markets, such as the cryptocurrency market or the stock market
- Transparency shortage, real estates are very commonly used for money laundering by big players
Algorand and AssetBlock solution
AssetBlock is a company founded in 2018 by present CEO Mike Liddell and CTO Stephen Pothier. Their goal is to bring new technology to the real estate space, which can ensure higher security, lower fees, and efficiency of an investment. This will also lead to increasing access to real estate, which couldn’t be reachable by many individual investors before.
AssetBlock launched its real estate investment trading platform on Algorand blockchain. With their partnership with Lodging Capital Partners (LCP), a leading owner and manager of various real estate assets and luxury hotels, AssetBlock tokenized exclusive hotel assets worth $ 60 million directly on the Algorand platform.
"AssetBlock is one of many innovative companies disrupting traditional business models by leveradging the power of Algorand’s blockchain technology," stated CEO of Algorand Steve Kokinos.
Kokinos then added:
„AssetBlock’s model to broaden capital pools for real estate investment aligns perfectly with our long-term vision of building a borderless economy by removing friction for these type of investment opportunities globally.”
Source: https://www.businesswire.com/news/home/20190917005104/en/AssetBlock-Launches-Investment-Platform-Algorand-Initial-60
But why Algorand?
Firstly, let’s see what is Algorand and where is its place in the crypto sphere. Algorand is a public blockchain platform for smart contracts using the Pure Proof of Stake algorithm to conclude consensus through the network. It has low computational complexity, fast block finality which goes together with very fast and very cheap transactions if you compare it to Proof of Work blockchains such as Bitcoin or Ethereum 1.0. Algorand reaches the maximum level of decentralization by using Verifiable Random Functions, a kind of cryptographical lottery, wherein the consensus mechanism the block proposer, as well as the verifiers in each block, are selected randomly and secretly. The native token of Algorand is called ALGO.
Founder of Algorand Foundation is Silvio Micali, who is a co-author of Zero-Knowledge Proof technology and who holds a Turing Award for his work in cryptography from 2012.
“Algorand’s technical mastery, combined with an experienced business leadership team and a vision for the borderless economy, were a perfect complement to AssetBlock. The Algorand platform is the only technology that can ensure the accuracy, transparency, and best-in-class security that’s required to bring accessibility and efficiency to real estate investment.”
announced Mike Liddell, CEO of AssetBlock.
Source: https://www.algorand.com/resources/blog/assetblock-and-algorand-modernizing-real-estate-investment
And Algorand provides this solution in cooperation with AssetBlock directly on the Layer1!
Final thoughts
It is obvious, that from this partnership and cooperation between Algorand and AssetBlock benefit both parties and as well the final users. This step, to start the cooperation, is in my mind a move in the right direction for the adoption of blockchain technologies. Those must bring significant value and upgrades to the present state.
By lowering the number of middlemen, reducing entry barriers, increasing transaction speed, adding transparency, and making this market more available and liquid is a perfect fit for both industries. Blockchain development and real estate.
Photo source: Pixabay
