28.03.2024

Securitize Launches Tokenized Platform to Revitalize Japan’s Rural Property Market

Securitize’s platform is designed to open the rural property market up to the outside world, providing much-needed funding to revitalize and even repopulate settlements with low or aging populations. Because there are few restrictions on foreigners buying properties in Japan, the platform can operate with relative regulatory clarity.

Digital asset issuer Securitize has launched a tokenized platform aimed at encouraging funding in under-invested real estate in rural Japan.

Built in collaboration with Tokyo-based fintech firm LIFULL Social Funding, the crowdfunding platform just finished undergoing joint tests, according to a Securitize blog post on Tuesday. Calling the project «very exciting,» Securitize CEO and co-founder Carlos Domingo said this was the beginning for both Securitize and LIFULL to «modernize the Japanese real estate market together.»

Although Japan has some of the most densely populated cities in the world, this has come at the expense of the surrounding countryside, which has experienced significant population decline over the decades. It’s estimated nearly 900 towns and villages across Japan will be deserted by 2040.

Securitize said the crowdfunding platform, which leverages Ethereum-based digital securities, is faster, transparent and more regulatory compliant than comparable legacy systems. Being built on a public blockchain means investors can also review and monitor the flow of funds.

In November, Securitize received a reported seven-figure sum from Japanese investment bank SBI Holdings to open an office in the country. Domingo told CoinDesk at the time the placement would enable his firm to begin offering digital securities to the Japanese market.

Securitize became involved in the crowdfunding platform after it acquired Japanese blockchain consultancy firm BUILDL in December.

Securitize Opens IRAs to Digital Securities Investors With Partnership

Digital asset issuer Securitize has facilitated what it says is the first direct IRA investment in security token offerings (STOs).A customer of alternative investments gateway AltoIRA purchased an initial investment in security tokens representing CityBlock Capital’s $20 million venture fund, with tokens issued by Securitize. The arrangement is set to open new opportunities for retirement account investors seeking exposure to digital securities, an alternative investment, said Securitize CEO Carlos Domingo.

“At the moment digital securities are not widely distributed”, Domingo said. “That makes it more complicated for investors to access them, creating a bad cycle.”

Before now, retirement investors were hard-pressed to find entry points into the high-risk, high-reward asset class AltoIRA CEO Eric Satz says has regularly outperformed the market.

“The idea of investing in alternative assets, much less a security token, would be anathema to traditional organizations”, Satz said, referring to companies such as Fidelity, TD Ameritrade and Schwab.

To overcome the institutional blockade, AltoIRA offers individuals those services as a self-directed Individual Retirement Account custodian. In effect this means AltoIRA facilitates trades and is the asset custodian, while the individual makes all investment decisions.

That introduces risk. But Satz said retirement account investors are up for the effort, and are not ones to invest in asset classes of any type without “doing their homework.”

“What we’re trying to do is open the doors and provide access to the everyday investor, the same access to higher assets” that institutional investors have, Satz said.

In the case of CityBlock Capital, the tokens will represent CityBlock’s ventures fund NYCQ, a private fund with $10 million allocated to institutional investors. NYCQ includes holdings in CoinBase, Bakkt, Tagomi and Nomics.

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