PTPEstate Will Digitalize The Real Estate Market
What is PTPEstate? Why do you plan to create this platform and what will it improve?
In order to answer the above questions, let’s take a look at what is currently offered on the real estate market and what PTPEstate has to offer.
The real estate market is currently seeing a boom in Real Estate Tokenization Platforms (RETP). Here are examples: REINNO Tokenizes $105 Million Commercial Real Estate Fund , $134M Zurich Real Estate Sold with 20% of Price Paid with Security Tokens , Investing in Commercial Real Estate with Cryptos and One Company You Should Know and you can probably find many additional articles about this.
What is it? There are many descriptions of this process, but they all come down to one thing. A company, or a person, that owns real estate, creates a Security Token Offering (STO) through an RETP – for its legal entity – under a virtual real estate pledge. The issued tokens have the right to trade on crypto exchanges that support security regulations relating to conducting STOs. At the initial stage of a token issuance, the token owner, according to the local security regulation, has the right to sell the tokens themselves. However, the main thing to specify in this process is that investors buy tokens only for further speculation on the market (i.e. buy low, sell high). As a rule, if the company that sold the tokens does not start manipulating them on the crypto exchanges (buy back, constant release of positive news on the market, the purchasing of liquidity services from third-parties, etc), then the value of the tokens will begin to fall after a short period of time and eventually come to zero. It’s a fact.
The continuing circle
Does this remind you of anything? The above scenario is a forgotten ICO process! Everything goes in a circle! Securities are issued without any support, are speculated on the public market, and then they are thrown into the trash. The same thing happened with ICOs, and will happen with IEOs. STOs are a virtual asset that will eventually be worth $0 if not supported – something that may cost the owner hundreds of thousands of dollars in marketing.
If you look closely at an STO, then there are many questions, such as: will I own the real estate if I buy all of the tokens? Answer: Of course not. Can the owner, after selling the tokens, sell the property through real estate agents and brokers? Answer: of course, and all token owners will only be able to hold the tokens! Will the state/province receive some tax revenue from the token sale? Answer: of course not. The local government provides a visible guarantee to investors that they are not deceived, but on the side, they do not receive any taxes. The local government can also forget about Land Transfer Tax revenue! What about real estate brokers and agents; do they get something from this process? After all, there are more than 100,000 of them in Canada alone!? The answer: no one is paid commission (other than the platform), the government doesn’t receive any tax revenue and Land Transfer Tax revenue, and as a result of the massive Real Estate Tokenization movement, all real estate brokers and agents will be unemployed (if they of course switch over to RETP completely)!
What are the chances of being successful?
You might have a question, what is the cost for a real estate owner to be successful in selling all of their tokens?
The calculation is simple – to create the tokens: about $10,000-$25,000. Preparation of the entire process including lawyers, designers, payment to advisors that most likely won’t do anything (they are there just to promote their faces) – from $50,000 up to $100,000. But the most important thing is the marketing, as without it, not one token will be sold. The marketing of an STO is very difficult, and the use of every dollar invested will bring about three dollars in investments/revenue. If you are a property owner and you are planning to raise $10M, then you need to spend $3,333,333 on marketing. After issuing tokens and selling them, you must pay crypto exchanges (that work with security tokens) to list your token – which is at least $70,000 to $100,000 (for example, in 2017, the cost to list an ERC-20 token on an exchange with traffic of over 400,000 people/month – all whom trade different currencies – was around 2-4 BTC). After such a calculation, the owner of the property will say: “why in the heck do I need all of this??! I’d better go call my real estate agent and he will sell my property for much cheaper”.
Because of all of this, after studying this whole process and countless platforms, we realized that the real estate tokenization sector is not built correctly – at all. We need to create something new that will not only allow real estate owners to get the necessary money for further development, but also: keep the interests of real estate investors, help real estate buyers, provide the local government with all the necessary tax revenues, simplify the process of selling real estate, give jobs to all interested real estate brokers/agents, and reduce the price of the process itself.
We’ve created a solution
We have developed an algorithm for a platform that will allow all parties to benefit from it! We apologize in advance for not being able to disclose all the details of the platform, as we are in the process of creating a patent. But, we will reveal a little what to expect from PTPEstate.
The platform’s algorithm will provide a process that will allow you to link the cost of sold tokens/PINs (property identification numbers) to the value of real estate on the real estate market. The owner of the property will be able to sell portions of their property, not an investment tool (STO), and its value will be determined not by crypto exchanges – but by the real estate market, commercial activities on the proposed property, and independent appraisal companies. This means that the risk of losing money from partially purchased real estate is significantly reduced and no speculation on any possible crypto exchanges, or other type of platform, will make the value of your assets zero. The platform will also allow buyers to earn income on purchased portions of real estate. The transparency of the transaction will be done during the conversion of the title deed to digital format.
Also, all real estate brokers and agents will be able to earn money on the platform from one sold real estate permanently. Generate an income for themselves every month from the results of previously done work. This is fantastic for them! After all, currently, they earn only once – from commission of the sold property. The local government will also be able to collect taxes on real estate sales. PTPEstate will be a platform integrated with PTPWallet, another creation of Core State Holdings, Corp., allowing for transactions to be conducted in FIAT and in crypto.
The property owner will receive a transparent tool for digitalizing their property, putting it up for sale, getting the maximum value for the property, and the cost of the entire process will be approximately equal to about 3.5% of the property value. It is important to note that the buyer will not pay anything for the purchased property at all.
Have a question?
We know that PTPEstate is the future of the real estate market. We understand that you have many questions about the platform that we can only answer after signing an NDA. But even then, we know that there are ways to bypass the agreement; and so we won’t be providing super specific information.
If you have questions that we can answer publicly, you can ask them to us on this site or to the community in the Q&A section.
We invite everyone, regardless of their country, to participate in the construction of the platform. The platform will work all over the world. Write to us on the registration form on the main page.
– Author: Oleg Cheine, CEO of Core State Holdings, Corp.