How Does Real Estate Tokenization Work?
Are you an investor and wondering how real estate tokenization works? Have you been scammed whole transacting in real estate? Well, you have come to the right place to know how you can avoid costly mistakes in real estate asset ownership and transfer.
Blockchain seems set to disrupt the real estate sector; tokenization will open up the industry ushering in new opportunities. Traditional real estate has been hit with fraud, bureaucracy, and the entire process is slowed down by brokers posing as middlemen.
What is Real Estate Tokenization?
Tokenization in the real estate simply means converting tangible assets into a digital asset which rides on a blockchain ecosystem. The process does away with the manual settlements by introducing smart contracts. Smart contracts are easily automated and come in handy when calculating asset valuation based on set parameters.
Technically, tokenization is a simple blockchain based method used to protect sensitive information and represented in a token that is algorithmically generated. These virtual tokens are passed online to process payments. You do not need a bank to participate in token economy networks.
Real estate tokenization ensures that the bad guys do not manipulate the system and tamper with your financial data. With a tokenized economy, online digital breaches are a thing of the past. It protects investors in the sector from “double spending”.
Is Tokenization the Real Estate Solution?
Blockchain might not work magic but is set to bring sanity back to the real estate industry. However, by encrypting data, the sector will be free from fraudulent payments, data breaches and cyber-attacks. The technology is immutable and tokens are used as user identifiers and generated randomly locking out any manipulation attempts.
Tokenization breakdown the real estate complexity and makes it transparent. All transactions are recorded on the blockchain and there is no weak entry point for data breaches. Tokenization is not restricted to the rea estate; it has worked credit and debit cards, in the healthcare industry and supply chain management sector.
If you want to tokenize your property, you need to record your ownership with the token you are investing in. This way, no one else can claim the right to the same property. Ownership right can only be transferred legally through blockchain.
Why Tokenization of Real Estate Assets?
Tokenization is the next generation investment. Once you tokenize an asset into a token, you can attach some value to it. What’s more; you can trade your tokens as shares in the market place when the token price appreciates.
By simply tokenizing your real estate asset, you can use it as a security which you can exchange for value. By tokenizing, you are simply assigning some value to your real estate asset. There are many startups that are tokenizing the real estate sector and the future looks great.
To get started with real estate tokenization, Funder One Capital has what it takes to transform your real estate investment dream to reality. You no longer need to deal with the fraudsters and middlemen in the industry; Funder One Capital has you covered.