As blockchain and cryptocurrency continue to move towards mainstream adoption in various countries, Germany is experiencing similar trends. The country’s Financial Markets Supervisory Authority (BaFIN) has given approval to the first blockchain based bond issuance firm.
The firm to which approval has been granted is called Fundament Group and the firm issues Real Estate backed bonds. Through the firm, over 250 million euros ($280 million) worth of properties in various German cities will be tokenized and offered as ERC-20 compliant tokens to investors from any part of the world. Some of the cities in which the properties can be found include Berlin, Hamburg, Jena, Fulda and Rostock.
There will be no minimum investment amount set for the tokens and this will allow people from any part of the world to purchase the bonds and sell them in any secondary markets. According to a representative of BaFIN, they have indeed approved a prospectus regarding blockchain based real estate bonds but this isn’t the first time with respect to blockchain technology as such. Traders who seek to buy crypto and invest in real estate will benefit from this project.
The bond issuance firm hopes that the blockchain project will assist in improving liquidity to the real estate market. Investment in real estate across international borders is difficult and this platform will enable these cross border investments with ease.
Speaking on the approval received from the German Financial Market Authority, Fundament’s co-founder, Florian Glatz, said that they are excited to enter the sales process for the Real Estate Security Token. He added that his firm is already in the process of preparing for the tokenization of other highly attractive assets.
Marketing of the tokens is expected to commence in the next few weeks and investors from across the world can be able to start purchasing real estate claims in Germany soon. Fundament has followed in the footsteps of a number of companies that have engaged in similar ventures in the past.
Real Estate Tokenization
Earlier this year around March, a US based investment firm called Inveniam Capital Partners issued real estate backed tokens worth $260 million in Florida. The tokens on sale were offered to American investors from all parts of the country and this enabled investors who were previously unable to access the Florida market to do so.
Another firm that has tokenized real estate is Templum Markets. The firm’s tokenization occurred in 2018 and the shares represent equity in the Colorado ski resort. The tokens can be purchased in US dollars, Bitcoin and Ethereum.