tZERO and ROI Group ™ have partnered to digitize and trade $50 million worth of Dubai real estate on the Tezos blockchain.
The tZERO – ROI Group™ Security Token Offering (STO) entails a real estate project in Dubai that is to be built over the next couple of years and should be realized by the end of 2023.
The STO will be issued in the third quarter of 2021 to raise capital for the project and to offer investors the opportunity to gain a preferred equity position at an early stage through the sale of security tokens.
Raising capital through preferred equity positions is very common for large real estate projects that need additional capital. But doing so through an STO, offers more liquidity to investors, which is a breath of fresh air in the traditionally illiquid real estate asset market.
Additionally, tokenizing the total investment and offering the STO on a platform like tZERO’s, lowers the capital threshold for investors by large margin. Investors with less capital to invest, are now able to invest in these types of assets that were previously only accessible to an elite group of investors.
These developments expand the reach for attracting capital from a larger group of investors. Very interesting for both investors and developers of large real estate projects.
It was stated in a press release:
“This represents ROI Group™’s first digital security project of what could be one of many future digital security offerings. […] ROI Group™ has multi-billion dollars in assets under management, with properties in the United States, Canada, and the Middle East. It specializes in land development, real estate investments, and passive co-investing.”
Decentralized blockchains are known to fork (split in two separate chains) on occasion. Sometimes by accident, as we’ve seen with Ethereum last November, when several of the biggest applications and assets on Ethereum were stopped for hours.
Forks can also happen with intent, when no consensus can be reached within the community. Bitcoin has seen quite a few hard forks and Ethereum was forked from Ethereum classic.
Either way, these hard forks can pose a serious risk: certain assets can not be duplicated. But if a blockchain splits, then everything that lives on the original chain will be live on new chains too. And when there is confusion about which of both chains is the official chain, then there could be confusion about which of the set of tokens is the real deal.
For strictly regulated assets like STO’s, this could cause big problems. Problems could include regulatory, technical, legal and other issues that have to be resolved after the event.
Tezos’ on-chain governance creates a smooth and swift upgrade process and ensures legitimacy for upgrades and protocol changes. In any case, the on-chain governance system eliminates the risk of confusion and discussions about what Tezos is.
Tezos represents the ultimate mitigation of fork-related issues for anything that’s built on Tezos. To read more about how and why this is the case for Tezos in this article: “Hard forks can be a risks for DeFI, NFT’s and STO’s. Here’s how Tezos avoids this issue.”
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Fraktion’s mission is to make real estate investment more accessible by enabling entry-level investments from 10 euros.
The platform operates by tokenizing assets into security tokens, thus democratizing access to the real estate market.
Ejara is about to offer its users the possibility to invest in government bonds, something that was not feasible for the average investor until now.
One billion Euros in total asset value is currently managed through Equisafe: €210 million in STOs have been financed through the platform, over 7,000 registered investors have an account, and it has seen €22.7 million in total trading volume to date.