Cryptocurrency is on a roll as we go to press. Things can change quickly in this arena, but right now, values are high. Bitcoin has never been higher. BITO, a new exchange traded fund (ETF) for bitcoin futures has come out. Even Berkshire Hathaway is talking about buying a home with bitcoin.
And now Coinbase, known for its role in the future of money, is thinking about the future of real estate.
Next Up: Alternative Real Estate Investing
Bison Trails, a blockchain infrastructure provider, became part of Coinbase in January 2021. Bison Trails adopted the Provenance blockchain in May 2021. And now, as a standalone part of Coinbase, Bison Trails will offer a user-friendly blockchain infrastructure for real estate projects.
Bison Trails recently began working with an alternative property investment group in San Francisco called Colchis Capital, as announced in October 2021. The collaborative goal of the two groups? To use the Provenance blockchain for better performance and transparency in real estate management.
Can these partners come up with the right blend of software to offer investor-owners a cost-effective, quick tool to create yield and cash flow reports? Beyond that, can they tokenize real estate? That is, can they empower people to work with real property in the form of digital assets?
Tokenization, in a Nutshell
Once a property or property company is tokenized, shares can go onto the blockchain. A property’s history becomes part of the indelible, digital record. A token can replace the volumes of paperwork that documents transactions today.
As transactions occur, the blockchain keeps a continuous ledger of appraisals, insurance, purchases, restrictions, contracts, rental income, investors’ votes, dividends — any pertinent data. The ledger is always available, transparent, and tamper-proof. It offers potential cost reductions and a simpler contract process. And with blockchain eliminating manual search processes, key data and history can be examined and understood quickly.
This concept is expected to arise as a notable use of blockchain technology. Little by little, actors on the global real estate stage are looking to blockchain as integral to the industry’s future. One prediction says tokenized real estate stands to reach a value of $1.4 trillion in five years.
Real Estate, Unchained
Do a search for real estate and Coinbase, and several interesting things pop up. Coinbase Custody connects with RedSwan CRE. It’s a hub for commercial real estate, tokenized. The idea? To give cryptocurrency investors access to commercial real estate investment opportunities in the form of digital assets. RedSwan, in a 2020 press release, sounded enthusiastic about joining with a platform that’s safe and comfortable for ordinary investors who “will be able to access high quality, income producing CRE projects alongside deep pocketed, private-equity and large investment firms.”
Coinbase has additional coins associated with real estate, such as the Omni Real Estate Token (ORT). The ORT platform allows investors to buy fractional shares in real estate assets. This innovation connects investors with property owners who aim to only partly liquidate their ownership interests.
A coin for the IHT Real Estate Protocol, connected to the i-house.com real estate blockchain, is also on the Coinbase menu. An IHT wallet opens the doors to the “digital credit society” — a rapidly unfolding aspect of the world of finance. Everyone can be an Airbnb landlord, IHT says. Everyone can own a WeWork®.
Traditional real estate investment, it seems, is in for some striking renovations. By most accounts, that’s good news for real estate. On the big-picture level, blockchain promises to make real estate assets easier to work with, and more accessible to ordinary people.
Supporting References
Bison Trails: Colchis Capital to Run Provenance Validators on the Bison Trails Platform to Drive Innovation in Real Estate Financing (Oct. 5, 2021).
Joe Lallouz and Aaron Henshaw Bison Trails: News – We’re Joining Coinbase! (Jan. 18, 2021).
Sam Bourgi for CoinTelegraph.com: Real estate Investment Firm Taps Bison Trails to Explore Use Cases of Provenance Blockchain (Oct. 5, 2021).
RedSwan via Cision PRWeb: RedSwan CRE Marketplace Signs Agreement with Coinbase Custody to Accelerate Adoption of CRE Digital Securities (Oct. 2, 2020).
IHT Real Estate Protocol: Global Real Estate Blockchain Cloud Platform.
Photo credit: Olya Kolbruseva, via Pexels.