$280 Million Ethereum Real Estate Bond Gets the Greenlight From BaFin
By Tyler Smith – Crypto Investor
Cointelegraph announced in a press release on July 23, that the German Federal Financial Supervisory Authority (BaFin), had just approved the security issuance firm Fundament Group’s Ethereum-based real estate bond.
Regulated Real Estate Bonds
The aforementioned bond, issued by a range of major German city properties, has an issued volume of 250 million euros ($280 million). The firm reportedly makes use of both financial and standardised instruments to make a real-estate asset that can be traded globally without adhering to any banking system. As this will be based on Ethereum, users may be able to buy and sell Ethereum within this real-estate system for the asset.
Real Estate Investment Liquidity Via Tokenisation
The organisation envisions that its project will bring more liquidity to an otherwise illiquid real estate market. Interestingly, this is the first-ever real estate backed security token. Florian Glatz, the co-founder of Fundament Group, had this to say on the development:
“As the first company to receive approval from the German Financial Market Authority for a blockchain-based real estate bond, we are excited to enter the sales process for the Real Estate Security Token”. Users will be able to buy cryptocurrency on this chain to trade for real-estate bonds. As this is a security token, it will be subject to greater regulation in which the token may be harder to obtain than an exchange token.
Through this system, the firm supposedly enables its customers to withdraw and also deposit funds in euros and Ether (ETH). The release goes on to show that the company is largely targeting major German urban centers, such as Hamburg, Berlin, Jena, Fulda, and Rostock.
German authorities also expressed interest in those developing blockchains and buying and selling crypto. In fact, a recent statement by the central bank noted that the possible benefits of Facebook’s cryptocurrency Libra mustn’t be overlooked in regard to potential risk and regulatory uncertainty.
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