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Tokenization is the next big opportunity in the hospitality industry. If you aren’t familiar with it, don’t worry: we are here to explain what tokenization of physical assets is and how it works.
Tokenization is the process of transforming owner of an asset digital format which is then represented by a token. In real estate tokenization, the ownership of the real estate asset is digitized, which allows for digital ownership and transfer. The token is similar to a share of a company. These digital tokens are used to represent the ownership of a real-world asset which is recorded on the blockchain. This allows real estate owners to trade, store, and transfer shares of their properties in the digital world.
The main advantage of using tokens instead of shares is that tokens can be traded without waiting until the investment reaches maturity. Most private asset investments, like real estate, are generally held for the full term or length of the investment. Many investors have life-changing events over five or ten years and may want to cash in on their investment before the end of the term. Tokenization enables that.
The amount of investment required to buy a real estate asset is extremely high. However, tokenization can lower the minimum investment needed opening up investment barriers which is a welcome change. This allows any investor to diversify their portfolio and enter previously exclusive markets.
The traditional illiquid nature of real estate presents a unique challenge for investors. People who are looking to make investments face difficulty in finding high-quality, liquid assets that fit their investment requirements. Tokenization allows the opportunity to trade out of an investment which gives flexibility.
It is an exciting new way to unlock the liquidity of traditionally illiquid assets and make them tradeable on secondary markets. This allows a much larger base of investors to participate in this ecosystem.
Tokenized assets allow faster and more efficient transactions while reducing the administrative burden on all parties involved. Smart contracts streamline many cumbersome manual processes, while clearing and settlement can become simplified and more efficient.
Tokenization allows for improved traceability and transparency by creating an immutable record of ownership. Every transaction is recorded and shared across a distributed ledger or blockchain—a database that records the history of activities performed over an asset. This enables all parties to have the most up-to-date ledger of ownership records and also have a clear view of any changes.
Tokenization removes physical barriers and geographic or infrastructure boundaries. Working within each country’s regulation, tokenized real estate investments allow investors to create a global portfolio.
Alberto is an experienced business development and people management professional. He has deep experience in sales and attracting top talent in the recruiting industry. Alberto is a semi-Pro football player, where he brings the strategies of football from the sports field to the office in marketing and team dynamics.
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GREATX by invitation ONLY:
Limited Tokens and Limited Subscribers.
GreatX tokens are issued only by invitation. The invitation is issued only to 11,000 subscribers across the globe, to participate with a limited number of Hotel Rooms across the United States.