NEW YORK--(BUSINESS WIRE)--Digitization of real estate assets is becoming a reality as UPRETS is now in the process of tokenizing certain condominium units at the Oosten property in Williamsburg, Brooklyn. The condominium that has 216 units will be the first property to have condominium units tokenized by UPRETS. New York has always been a big market for real estate, even after the 2008 housing crisis. This luxury project has 1, 2 and 3-bedroom units to cater to the needs of different people. The Oosten property was developed by XIN Development Group International and is at the heart of Brooklyn which has become one of the most attractive submarkets in New York City.
How tokenization occurs on the UPRETS platform
UPRETS developed permissioned blockchain (X-BOLT consortium chain) and inter-chain technology to facilitate the tokenization of real estate assets. Every token issued through UPRETS, defined by smart contracts, will represent partial ownership in certain units at the Oosten property. Smart contracts, running on X-BOLT, govern how the tokens behave, in both initial offering and external circulation scenarios.
- Consortium chain. UPRETS has been developing the X-BOLT consortium chain, which is an active branch of HyperLedger. The consortium chain also features a website and a mobile app where investors can access information. It also comes with pre-developed smart contracts that are only open to the issuer and the potential investor.
- Public chains. UPRETS uses both bitcoin and ethereum (coming soon) protocols as its public chains. All communication in the issuance of URT Oosten tokens will happen through OmniLayer, which is the most popular communication protocol on the BTC network. The generation of tokens occurs on the BTC network as it is easily adaptable.
UPRETS’ inter-chain structure ensures there is transparency on information flow through the public blockchains. There is also efficiency because the OmniLayer protocol can adapt to major exchanges and allows 24/7 trading. On the other hand, the permissioned chain (X-BOLT) ensures that only authorized nodes can view specifics of the smart contracts and validate transactions.
X-BOLT generates public/private keys through independent nodes for potential investors. X-BOLT chain maintains privacy as it ensures that only vetted individuals can access private contract information, unlike the ethereum public chain which allows anonymous and irrelevant users to access all smart contracts.
How the property owners and potential investors benefit from the tokenization
The developers will access the international market which has been a challenge in the past. Real estate has been for long conceived to be a ‘rich-man’s’ asset class. However, one does not need to be wealthy as the entry requirements are now low as retail investors outside the US can invest as little as 1 USD. The owners of tokenized assets will not have to worry about KYC/AML because smart contracts will take care of that. The platform will also manage all the investors’ data and make it easier to reconcile information for better decision-making.
Liquidity issues have been a problem as it can take up to 8 years for a real estate asset to become liquid. Tokenization will make it possible to trade tokens through secondary markets which increase liquidity.
How UPRETS will assure investors that their tokens will be safe
Cybersecurity has always been an issue when it comes to online transactions. There are internal measures that ensure all the tokens issued will be safe. There is a separation of data and applications, which ensures that they do not override. The website also undergoes repeated testing and fixing for vulnerabilities that might expose the tokens to attackers.
The immutability feature is one of the most significant blockchain features that makes it applicable in real estate. UPRETS will provide instructions on how to acquire and move URT tokens while the investors are expected to keep their private keys safe.
Note: "UPRETS" is the brand name of the blockchain platform technology services being developed and offered by entities affiliated with Xinyuan Real Estate, a China based property developer. The blockchain platform technology and associated services are offered pursuant to contract by REFINTECHCO, a Cayman Islands company affiliated with Xinyuan. REFINTECHCO licenses this blockchain technology, on a non-exclusive basis. from Beijing RXZT Technology Development Co. Ltd., a company organized under the laws of the Peoples Republic of China and also affiliated with Xinyuan.