ASSET

The infrastructure for tokenization of real estate

Learn more about Cashlink's disruptive technology based on distributed ledger technology. It gives you the unique opportunity to revolutionize the real estate market.

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Tokenization of real estate simply explained - a pioneering technology

When real estate is tokenized, it is fragmented using distributed ledger (blockchain) technology and then is mapped in the form of crypto securities (tokens). These tokens represent a share in the underlying real estate defined in the legal documentation and the associated rights and obligations. A so-called “smart contract” keeps a registry of the investors’ token holdings.

real estate tokenization explained
real estate tokenization explained by Cashlink

Why tokenize real estate?

Due to the high capital commitment, investments in the real estate industry remain reserved only for selected groups of investors. Therefore, the tokenization of real estate offers significant advantages.

New investor group

Barriers to entry are lowered by lower capital requirements. New investor groups can thus invest in the growth of the real estate market.

Increased liquidity

The tokenization of real estate leads to increased liquidity in the market due to the digitization and transferability of shares in the form of tokens.

Digitization reduces costs

Significant cost savings can be realized through the elimination of intermediaries in the traditional financial industry and the greater digitization of the value chain.

Increased transparency

The automation of processes significantly reduces costs. At the same time, transaction costs and organizational effort are reduced. 

4 Tokenisierte Assets mit Cashlink

Real estate use case

Real estate tokenization with Cashlink

Investments in real estate are becoming increasingly popular: Transaction volumes in the German real estate market are rising steadily and are expected to grow even further. Although interest in and demand for real estate is increasing, there are few suitable investors. Traditional real estate investments are highly illiquid and expensive due to many intermediaries.

Tokenization, or the digitization of securities, has the potential to permanently change the real estate industry. Tokenization uses blockchain technology: a distributed ledger secures identical copies of data across a network of authorized parties. This new and innovative technology helps issuers automate intermediate steps. This increases the liquidity of real estate, allowing new groups of investors to access the market. 

HOW TO

3 steps of real estate tokenization with Cashlink

This is how Cashlink makes it easy for you to profit from tokenization:
Strukturierung der Immobilientokenisierung mit Cashlink

Step 1: Structuring

As with a traditional securities offering, you must first decide on legal terms and conditions before starting the real estate tokenization processes. Specialized law firms from Cashlink’s partner network support you in the legal drafting of the contracts.
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Step 2: Issuance

The legal contracts are digitally represented by so-called smart contracts. These smart contracts generate tokens that represent shares in the tokenized property. They automatically execute actions based on the underlying legal contract. Cashlink’s product packages include everything needed to do this. Your company does not need to interact with the blockchain layer, as Cashlink completely takes care of the tokenization process.
Ausgabe der Immobilien-Token
Handel am Sekundärmarkt mit Immobilientoken
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Step 3: Secondary market

Since tokens are globally transferable around the clock, liquidity is further increased. Because tokenization can be used for a wide variety of real estate investments, liquidity is further increased. Because the invested capital is no longer tied up for long periods of time, new investors can participate in the market.

IMMOBILIEN FAQ

Frequently
asked questions

Currently, it is not yet legally possible to tokenize a property natively in Germany. A land register entry is still required. In the land register, it is recorded in accordance with the law whether a property exists and who its owner is. Therefore, the real estate itself is not tokenized, but rather a company that owns the real estate.

Crypto securities are used for the tokenization of real estate, which include the customer’s right to ongoing income and increases in the value of the underlying real estate.

Yes and no. In a sense, a real estate token represents part of the ownership of the real estate, as the holder of the token is entitled to a portion of the income from the real estate. However, the real estate token itself is not ownership of the real estate itself, but rather a debt agreement. The exact rights to a tokenized property depend on the specific terms of the token contract and should be carefully considered.

There are several ways in which real estate tokens can be structured. The most common option is to acquire the property through a special purpose vehicle. The shares in this company are in turn covered by a tokenized debt security. The exact structure of the token model depends on the goals and needs of the issuer and should be carefully considered.

Real estate tokenization uses crypto securities that contain the customer’s right to ongoing income and appreciation of the underlying real estate.

Start tokenizing real estate

The possibilities of tokenized real estate are endless. Contact our team of experts to learn how your business model can benefit from tokenization!