This week, Hamburg-based tech startup KlickOwn announced the formation of a strategic partnership with the leading financial platform Netfonds AG. The maneuver is part of larger plans to launch a blockchain-based management and marketing tokenized real estate platform. The news demonstrates further tokenization in the EU market.
The updated KlickOwn tokenized real estate platform will allow investors and property owners to conduct business via the blockchain. As such, the platform will allow for the tokenization of properties, the issuance of security tokens, and the management and trading of these financial instruments.
Speaking on the partnership, KlickOwn founder and CEO Alexander Braune called the move a significant milestone in the market. Additionally, he described how the partnership moves the firm closer to its overall goal to democratize capital investments in real estate. He also touched on the years of experience Netfonds possesses and how this experience aligns with KlickOwns strategy.
Interestingly, the project represents one of the first tokenized real estate ventures on the Stellar blockchain. Stellar is an open-source, decentralized payment protocol that allows for fast, cross-border transactions between any pair of currencies. Additionally, as a fourth-generation blockchain, Stellar provides advanced smart contract programming capabilities.
The decision to utilize the Stellar blockchain opens the KlickOwn platform up to a host of new functionalities. For one, it provides very low transaction costs. Most importantly, Stellar is decentralized and is a non-profit company with altruistic goals as opposed to a general profit-making strategy
Gain Security and Efficiency – KlickOwn
Also discussing the maneuver, Wladimir Huber, founder and board member of KlickOwn praised his firm's cooperation with Netfonds. Importantly, he took a moment to describe the new product and some of the advantages tokenization brings to the platform. He explained that users gain the same advantages as a classic bond but without all the extra costs normally associated with these transactions. Specifically, the new system eliminates the need for global certificates or costly bank deposits.
For its part, Netfonds will lend their expertise as a regulatory service provider. As such, the firm will handle the regulatory function of the liability umbrella, and the structuring and approval of the bonds managed on the blockchain. Lastly, the firm will be responsible for the digital asset management phase as well. To accomplish this task, both firms plan to cooperate closely with NSI Netfonds Structured Investments GmbH. Notably, NSI Netfonds Structured Investments GmbH is a subsidiary of Netfonds AG.
In a recent interview, Peer Reichelt, CEO of Netfonds AG discussed the project's potential. He explained that the new platform allows for the direct management and brokerage of real estate investments. Additionally, he spoke on how the new platform will enhance the positioning of Netfonds' real estate division. Specifically, Reichelt believes the new platform will expand the firm's real estate sales division and lay the foundation for a new digital business model.
Investors looking to participate in the KlickOwn tokenized real estate STO can do so by going directly to the firm's website. Here, you can easily purchase digital real estate bonds after filling out the required registration information. Notably, the minimum investment amount is only 10 euros. Additionally, the platform provides you with a variety of ways to pay for your new tokenized bond, including using a classic SEPA bank transfer.
Lowering the Entry Bar – KlickOwn
One of the most important aspects of the KlickOwn concept is the desire to make real estate investing available to anyone. The platform's minimum investment level of just 10 euros makes this dream a reality. In this way, international investors can easily participate in the German real estate market without worrying about minimum funding barriers.
Previously, investors needed to provide a significant amount of funding to participate in international property sales. In most instances, these exclusive investments were only available to accredited investors. An accredited investor is someone who has at least $1 million in liquid assets. Unfortunately, this strategy left both investors and property owners suffering.
For one, most investors lacked the funding to participate. Consequently, these investors needed to go elsewhere to participate. In many instances, they were forced to invest in less desirable and riskier ventures. Simultaneously, property owners often turned away funding because it didn't meet the necessary minimum requirements. Luckily, KlickOwn's platform eliminates all of these issues.
KlickOwn on the Future
The platform currently offers only tokenized properties in Germany. In the coming months, the firm may expand to other EU markets. Currently, investors receive fixed interest payments for their participation. According to company documentation, the firm intends to offer separate digital real estate bonds with corresponding BaFin-regulated security tokens for each real estate project.
Netfonds provides administration, advice, transaction processing and regulation for the German financial industry. The firm utilizes a web-based technology platform that enables users from the financial industry to process financial market transactions fully, securely and while remaining in compliance with EU securities regulations. The firm's clientele includes fund companies, asset managers, financial advisors, special banks and insurance companies.
Tokenization Takes the Real Estate Markets by Storm
This news is just the latest in a long list of firms tokenizing real estate funds. Just this week, Red Swan partnered with the tokenization giant Polymath. The pair successfully tokenized $2.2 billion in properties as part of their first venture. Every day more tokenization platforms enter the real estate sector.
In the past, many of these projects have fallen to the wayside due to paperwork or funding issues. Now, for the first time, real estate firms are partnering with tokenization platforms to ensure their products and market approach are tailored to the real estate sector. Consequently, there is an influx of tokenized properties making their way to the public in the coming weeks.
For now, KlickOwn appears to have a jump start on the rest of the EU market. You can expect to see the firm capitalize on this lead as the company continues to expand its products and marketing.