New York-based Realecoin is the world’s first real estate fund built on the Ethereum blockchain. They’ve recently announced the details of a new security token which aims to disrupt the conventional sector of real estate investing.
How the Realecoin Real Estate Fund Operates
Security tokens continue to make waves in the traditional securities sector. They’ve made their way into the funding of Hollywood films, fractionalized property ownership in Manhattan, and Wall Street incumbents such as Fidelity.
The newest wave centers around real estate. The Realecoin security token, abbreviated as RC, will serve as a digital representation of fractionalized ownership interest in a diversified real estate fund, called Realecoin.
Recently, Andy Strott, Co-Founder of Realecoin, emphasized the values behind his company’s product.
“We at Realecoin have aimed to build a product that first and foremost benefits our investors. We have partnered with leading experts in the field in an effort to ensure a compliant, secure and successful product. With the help of Securitize, a pioneer in this industry, we plan to stay at the forefront of blockchain technology as this industry develops, always striving to implement its most advanced aspects for our investors.”
RC Security Token Details and Functionality Explained
RC is an ERC-20 compliant security token that is being built on the Ethereum network. Importantly, tokens are fully SEC compliant, and are restricted to accredited investor access.
The Realecoin fund has specific investment criteria. It strategically looks for income-producing multi-family housing which requires renovation or redevelopment, likely due to distressed mortgage debt. As of now, Realecoin’s investment focus is limited to the geographical confines of the US.
Those who hold the RC token will be entitled to a pro-rata share of distributions from both income and net revenue of future sales in the investment portfolio.
Above all else, Realecoin is using the RC token as a means to offer 24/7 liquidity to a previously illiquid form of investment. Added liquidity and investor access seem to be major aspects of the driving force behind the security token industry, which some predict to reach $10 trillion within five years.
Realecoin Teaming Up with Securitize to Ensure a Successful Offering
Likely due to the present digital asset atmosphere which features a generally unclear SEC regulatory framework, Realecoin is partnering with Securitize to perform a successful offering.
Securitize is a software compliance platform which issues and manages security tokens. They deal with dividends, distributions, and share buy-backs— all recorded on the blockchain.
Carlos Domingo, Securitize CEO, recently commented on the news.
“Realecoin offers a unique investment opportunity through the tokenization of real estate assets, usually considered to be a very illiquid asset. The management team’s lengthy track record, alongside their commitment to regulatory compliance makes this an exciting venture for Securitize.”
What do you think of fractionalized ownership of a real estate fund in the form of a security token? How will this affect the overall security token community? We want to know what you think in the comments below.
Image courtesy of Realecoin.