Benefits of Blockchain Powered Crowdfunding for Real Estate

Posted By Asha Devi | 23-Jul-2019

A real estate crowdfunding platform enables real estate companies to attract funds from a variety of investors. Investors use such platforms to evaluate projects and invest directly. It serves as a marketplace where entrepreneurs and investors engage each other with secured transactions.   

 

Blockchain-powered Crowdfunding Platform

A real estate crowdfunding platform can be used by property developers to showcase their project scope, potential, capital requirements, and profit shares to attract investors. Similarly, investors can identify profitable opportunities to make sound investments. The platform makes it faster and easier for both parties to fulfill each other’s requirements.  

 

Investors who use blockchain-powered crowdfunding platforms receive precise inputs about expected returns and exit period to invest and gain shares in projects. Such platforms play a critical role in ensuring transparency in real estate dealings for investors. 

 

Blockchain-powered crowdfunding for real estate business

 

Blockchain-powered real estate crowdfunding involves a decentralized, regulated, property - financing, listing, and managing platform. It decentralizes the trading of assets, rental agreements, purchase/sale agreements, property task management, and related services on the blockchain. Blockchain technology facilitates peer-to-peer financing for real estate projects. 

 

Blockchain technology streamlines real estate requirements by enabling investors and proprietors to share data and funds securely and efficiently. It eliminates middlemen, reduces fraud, and makes information more accessible. A blockchain crowdfunding platform accelerates risk evaluation and investment processes. 

 

Real estate businesses can raise funds using a variety of financial instruments such as Initial Coin Offering (ICO), Security Token Offering (STO), and Initial Exchange Offering (IEO). Investors can invest in real estate business through tokenization. 

 

How blockchain-powered crowdfunding for real estate works?

 

The following flow-chart explains the various steps that occur during the funding process. 

 

Several projects say A, B, C, D..and so on are announced on the platform

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Let’s consider that an investor decides to invest in project C

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The investor purchases an equivalent amount of ICO tokens by depositing fiat currencies directly through the platform

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Then, he transfers the token to the project C within seconds

                                                 ↓

The real estate developer holds the token or liquidates them to fiat currency

                                                   ↓

Whenever there is a request to convert, the investor can buy the tokens back or sell them

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Investors can sell them to other investors who are interested in purchasing the tokens

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A smart contract is executed whenever a token is transferred from one person to another

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During every smart contract execution, a gas fee is spent in the form of ETH

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Through repayment, interest, dividend, or redemption of shares, investors can receive a return on investment

 

How Oodles blockchain-powered crowdfunding platform is beneficial for your real estate business?

 

Using blockchain and smart contracts, we at Oodles develop an easy to use crowdfunding platform. It enables investors to manage their funds in domestic and international markets while significantly reducing transaction costs and time. Our blockchain developers have experience in tokenizing real estate assets and selling them while complying with regulatory requirements.

 

The benefits of building a blockchain-powered crowdfunding platform with Oodles are as follows. 

Benefits of Blockchain-powered Real Estate Crowdfunding Platform

 

Enhanced transparency

Live dashboards and qualitative reports enable investors and real estate businesses to maintain transparency to prevent fraudulent activities. 

 

Analytical tools

Analytical tools enable investors to understand associated risks by viewing the history of previous transactions and make wise decisions.

 

Regulatory compliance

The transfer of funds in the form of tokens, assets or fiat currencies using the platform is 100 % compliant with security regulations. 

 

Portfolio Analysis

Portfolio analysis enables investors to invest wisely by understanding property data and investment risks.

 

Investor communications

Investors can communicate using interactive dashboards and secure data rooms. The information flows and financial reporting are updated automatically.  

 

Fund management

Funds can be easily managed with dedicated workflow tools. It includes accredited, non-accredited, and other investors. 

 

Deal flow management

It enables existing and prospective investors to access the dashboard through mobile. Investors can enable/disable/edit parameters of equity/debt/profit sharing and convertibles. 

 

Final Thoughts:

 

With blockchain technology, it is easy to maintain transparency and manage funds with better insights. Real estate developers and businesses can earn the trust of investors across the globe. The investors can keep themselves updated about the business and wisely invest their funds. 


 

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