The Netherlands is gearing up to welcome a new application for blockchain technology, as a blockchain-based crowdfunding platform recently got the green light to operate.
According to a press release, Financial Markets Authority in the Netherlands has approved the operation of Max Crowdfund, a real estate crowdfunding platform powered by blockchain.
Easier Real Estate Investments
Max Crowdfund is the brainchild of the Max Property Group, a real estate firm founded in 2016 and with branches in the Netherlands, United Kingdom, and Germany. The service has become famous even before launching, and approval from the Dutch regulator is now the final hurdle in its process.
Reports claim that the service already got 70,000 users before its release. Max Property Group plans to release it on the iOS and Android platforms, with the hope of democratizing the real estate investment process. The service will allow investors by properties with as little as 100 euros ($117), while real estate developers will have access to a pool of investors from home and abroad.
With Max Crowdfund, investors will have to pay a one-time fee equal to 0.1 percent of their investment. The service also charges monthly administration fees of another 0.1 percent. All of these fees will be used to purchase and make the service’s security tokens.
The platform will be powered by Ardor, a public blockchain platform built by Jerulda. Erwin van Kekem, Max Property Group’s CTO, said of the milestone
“It has been several years since we initiated the development of Max Crowdfund and obtaining the approval from the AFM was a long 10-month process due to the blockchain component, but we are extremely pleased that we can finally officially go live.”
Securities Token Boom
Max Crowdfund appears to be gearing up to corner a fledgling market with its upcoming security token. The security token space has grown significantly over the past few months, with more companies issuing them to back their real estate ambitions.
One such is Aspen Digital Inc., a company that recently revamped its “Aspen Coin” into the ASPEN token. The token represents about $18 million worth of indirect ownership of the St. Regis Aspen Resort — a five-star hotel chain in Colorado. It recently got listed on tZERO, the leading security token exchange.
Many considered Aspen’s token sale to be the first real estate security token. The firm issued 1.675 million shares, with each priced at $20, in August 2018.
At the same time, there has been a notable focus on real estate tokenizations too. Last month, French financial technology firm ID Distribution announced that it had allied with local real estate firm Groupe JDI to tokenize properties in Paris.
Per reports, the firms claimed that they would jointly issue security tokens and a bond listed in Frankfurt. The purpose of these was to acquire buildings in downtown Paris. They planned to spend 70 million euros (about $78.5 million), using the funds to purchase — and lease — about five buildings.
The companies explained that they were using security tokens instead of traditional debt instruments to strengthen their capital. Their security token will feature s 6.5 percent yield.