Real Estate Tokenization
Weeks ago, news broke that the St. Regis Aspen Digital Securities would be migrating onto the Securitize platform. The company behind the St. Regis DSO endeavour is known as Elevated Returns. Today, Elevated Returns and Securitize released joints statements, discussing their future intentions for the digital securities industry.
In this announcement, the duo indicated an intent to eventually tokenize $1 billion worth of real estate. To achieve this feat, the companies will be turning the Tezos blockchain. This particular blockchain was chosen after the aforementioned migration of Aspencoin was successfully completed. It should be noted that this is not just a pipedream. Elevated returns already have the real estate assets in hand and earmarked for tokenization.
The lofty goals that these companies have set out are exciting, and paint a promising picture for the future of digital securities. Make sure to regularly check out headlines, as we will surely be reporting on future endeavours involving each of these companies.
In their press release, representatives from each organization spoke on the matter at hand. The following is what each had to say.
“Having worked closely with regulators and local authorities around the world, we understand the need for the highest security and compliance features. There is no better solution than working on a Tezos-based token implementation. We have a number of very high-profile deals lined up and we could not afford to compromise the technological product. With the Tezos-powered solution and its integration in the Securitize portal technology, we feel we have a total solution.”
“The addition of Tezos and adoption of our DS Protocol as a defining standard for the Tezos blockchain is not only great news for global real estate, it also cements Securitize’s leadership in the market.”
Elevated Returns is a company focusing on building a ‘Digital Financial Asset Ecosystem’. They are based out of New York, New York, however, service regions in the U.S, South East Asia, and Europe.
Company operations are overseen by President Stephane De Baets. Stephane brings decades of experience in finance to the table. Overall, speaking 4 languages – English, Dutch, French, and Thai – Stephane is an ideal leader for a worldly company.
Since commencing operations in 2017, Securitize has developed a tech-stack that allows for them to offer clients end-to-end tokenization services. For instance, these services range from token creation, to issuance, and lifetime management post distribution.
In Other News
While this is the first time we have detailed Elevated Returns, Securitize is no stranger to our newsfeed. Below are a few articles detailing recent advancements made by Securitize.
Polymesh Whitepaper Sheds Light on Specialized Blockchain
Nearly ten months after their initial announcement of Polymesh, Polymath has just released the inaugural whitepaper for their anticipated project.
As industry players continue to establish the foundation of the digital securities sector, Polymath is doing their part. After years of developing Ethereum based solutions, the team recognized a real need for a blockchain, tailor-made with digital securities in mind – Enter ‘Polymesh’
A Closer Look
While the benefits of a tailor-made blockchain are plentiful, Polymath notes 4 areas, in particular, that are being addressed through Polymesh.
Unsurprisingly, these are all issues being consistently noted as hurdles within the sector, by more than just Polymath. By creating Polymesh, and doing their best to address these key points, Polymath has the potential to become the blockchain of choice, at a time when industry participants are actively looking for such a solution.
A further point of interest is that Polymesh is noted to support more than just digital securities. Recognizing the utility behind stablecoins, Polymesh brings support for these assets as well.
Upon announcing the release of the Polymesh whitepaper, the team at Polymath took the time to comment on the structuring of this new blockchain. They state,
“With Polymesh, we’re building a blockchain specifically for security tokens. We’ve made confidentiality, identity, compliance, and governance key design principles in the architecture, working them into the ideation and the foundation of the chain, to create an enterprise-grade platform that drives the acceptance and adoption of security tokens.”
When this project first caught our attention, it was intriguing beyond technological reasons. This intrigue was due to the talent and personnel responsible for the endeavour – specifically, Charles Hoskinson.
As the co-founder of both, Ethereum and Cardano, Hoskinson knows a thing or two about the development of successful blockchains.
At the time of the original announcement, Hoskinson had the following to say on Polymesh.
““The new Polymath securities specific distributed ledger technology platform that we are architecting, which will be highly optimized to the requirements of financial investors, issuers and markets, has the potential for innovation and global participation that can lead us towards this sudden disruption, and the next evolution of open and decentralized finance.”
Founded in 2017, Polymath maintains headquarters in Toronto, Canada. Through experience gained from the issuance of well over 100 digital securities, Polymath has managed to develop various solutions for the sector. These solutions range from Polymesh, as discussed here today, to token standards, such as ERC-1400.
CEO, Kevin North, currently oversees company operations.
In Other News
As alluded to earlier in this article, the digital securities sector finds itself at a point in time in which many of the leading players are in flux. With the path moving forward becoming clearer for many, we have seen various instances in which these companies have announced their decision to move away from Ethereum, and utilize other blockchains better suited for their needs.
The most recent example of this comes from Vertalo, as they recently announced their decision to utilize Tezos.
Vertalo Chooses Tezos for Security Token
This week, the Austin, Texas-based transfer agent, Vertalo shocked investors after announcing it would transfer its tokens over to the Tezos blockchain. The decision to convert tokens over to the Tezos blockchain comes after Vertalo executives examined the benefits of such a transfer carefully after it announced that its VToken smart contract securities would be produced on the Tezos blockchain, by default, for all new issuers.
Despite the change, Vertalo will still support their ERC-20 tokens moving forward according to company documents. The news comes after the release of a new protocol that allows the firm to convert ERC-20 tokens to Tezos-formatted smart contracts. In this way, the transition is seamless. As such, Vertalo encouraging customers to make the switch over as well.
Speaking on the decision, Dave Hendricks, CEO of Vertalo explained the motivation behind his company’s decision. He explained that through the use of the Tezos blockchain, his firm can simplify the entire tokenization process. The added functionality allows Vertalo to better “cover 99 percent of the security token and smart contract landscape” moving forward.
Tezos Provides Added Features
Hendricks also touched on the advanced capabilities that made Tezos a better option for his firm’s strategy. Specifically, he listed Tezos’ advanced smart contract programming capabilities. These smart contracts are ideal for tokenizing equity and debt, both markets in which Vetalo hopes to play a major role in developing.
Additionally, Hendricks spoke on some of the other important aspects that motivated the change. For one, Tezos is a proof-of-stake (PoS) blockchain. As such, Tezos’ blockchain utilizes far less energy to secure than traditional Proof-of-work systems such as Bitcoin or Ethereum. Importantly, Ethereum intends to transfer over to a PoS consensus protocol this year.
Also, Tezos allows developers to program smart contracts using multiple programming languages. This gives developers access to a variety of new capabilities. Importantly, this flexibility provides a more stable network of participants and expands the firm’s current collateralization opportunities.
Lastly, Hendricks spoke on Tezos transactions per second rate. Tezos currently can handle around 40 transactions per second but the platform features a design that can be scaled up considerably to suit future demands. In comparison, Ethereum can handle only about 15 transactions per second. In the past, this has led to congestion on the Ethereum blockchain.
Vertalo Seeks to Tokenize Real Estate
Importantly, one of the key focuses of the Vertalo platform is the tokenization of real estate. Notably, a Tezos managed real estate fund could operate in a manner similar to traditional real estate funds without the need to change the current practice of simultaneously paying out a staking-based dividend next to an asset-secured dividend. This strategy is ideal when discussing the tokenization of large real estate funds that attract mainstream investment firms.
The Vertalo platform handles a number of important tasks within the industry, The firm issues digital securities and manages data for the broker-dealers, issuers, custodians, and exchanges. On top of these tasks, Vertalo also manages cap tables for startups, tokenize shares, and even hosts Security Token Offerings via the company’s REGD V-token.
Vertalo and Tezos – A Strong Team
The decision to transfer over to the Tezos blockchain makes sense when you consider the added functionality the change brings to Vertalo. Tezos continues to expand its market positioning in 2020. Consequently, you should expect to hear more from both of these firms in the coming weeks.
Visa Token Service Launches this Month
This week, the world’s largest digital payment platform, Visa Inc. (NYSE: V) announced that its blockchain-based Visa Token Service would be instituted across the US. The Visa Token System tokenizes card payments to streamline the entire payment process. The integration is meant to simplify and further secure the online shopping experience for millions of users. Importantly, the decision to utilize blockchain technology signals a shift by one of the largest payment processors in the game.
According to company documents, on January 21 the new system will replace Visa Checkout across the US. Basically, all active US Visa Checkout merchants will get the upgrade without the need to make any changes on their part. In essence, it will be seamless.
Discussing the goals of the transition, Jack Forestell, the Chief Product Officer of Visa, explained that his firm wanted to create the “best customer experience possible.” As such, the firm recognized an urgency to build a more seamless and secure platform specifically designed to meet the needs of online shoppers. He also took a moment to tout the added level of security achieved through the integration of blockchain tech.
The new system integrates a host of advanced technology and authentication methods to keep users safe in 2020. Some of these new technologies include the integrations of device binding and biometrics systems.
The new systems will allow all participating retailers to shorten the number of steps required to make an online purchase. For example, consumers will no longer need to enter a 16-digit primary account number when making their purchases. Additionally, the upgrade does away with old school passwords.
A New Strategy for Visa
Part of the motivation behind the upgrade came from the release of The Visa Global Merchant eCommerce Study (GME Study). This yearly study looks into the most important factors in successful online sales. Importantly, this year’s results showed that quick delivery (44 percent) was at the top of shoppers’ demands. Also, it listed an easy checkout process and convenient payment methods as the following most important attributes.
Visa Token Service
The Visa Token Service has been in development since the middle of 2019. Early reports of the plan surfaced after news broke of Visa’s intention to purchase the blockchain tokenization firm Bell ID from Rambus in June. In the end, the payments giant decided it was best to purchase two subsidiaries from Rambus. These subsidiaries were Bell ID and Ecebs Ltd.
The new system allows Visa to securely tokenize assets with bank-grade encryption in minutes. Executives stated that the first steps are to tokenize transactions from its Visa cards and other payment systems. This concept is the next step in Visa’s blockchain strategy which began with the tokenization of sensitive information. This maneuver was an attempt to remove the need to share private information with third-parties directly.
Speaking on the new strategy, TS Anil, Global Head and Senior Vice President at Visa, explained the decision to focus on tokenizing card transactions first. He described the importance of securing digital payments in today’s online economy across multiple form factors.
Visa Token Service
The Visa Token Service is a prime example of how blockchain technology simplifies the current business systems. With most reports predicting a combined eCommerce volume of $1 trillion this year, its no surprise that Visa continues to explore its options. You can expect to see this firm continue along its tokenization path as the cost and security benefits are too large to ignore.