Real Estate Backed Cryptocurrency

February 20, 2018
Real Estate Backed Cryptocurrency

A tech start-up company called Aperture is making news by going public with their very own cryptocurrency. It’s called Property Coin and it is an asset-backed token.

This is not the first backed cryptocurrency. Tether is backed by a one to one, token to dollar system. However, Property Coin is the first to use real estate properties as an asset for their digital money system. Aperture says that Property Coin is based on the Ethereum block chain and its main purpose is for home flippers and real estate investors.

Aperture is a California-based real estate technology and investment company. Their focus is on rehabs, acquisitions, dispositions, and writing loans for real estate developers. There is a detailed outlline on their website of the Property Coin planned profit structure: Aperture will invest 100% of the net proceeds from the initial coin offering (ICO) into real estate properties and loans. Property Coin holders will own a fraction of all assets in the Property Coin purchasing entity and are entitled to 50% of the net profits from the investments. Aperture will reinvest 50% of the profits in real estate properties to create more value.

According to Aperture Co-CEOs, Andrew Jewett and Matt Miles, the Aperture team invested its own money and spent over a year created proprietary software to aid with identifying and analyzing investment opportunities in real-time called Sherlock. They also developed a piece of software they call LENS, which monitors the operational status of their property and loan portfolio. 

The real estate industry has been slow to adopt the use of cryptocurrency in closing transactions. With the volatility of Bitcoin and inability to track where the funds originate, luxury residential real estate has been especially wary. However, an investor named Michael Komaransky recently made the most expensive real estate purchase using Bitcoin. In late January, he bought a 9,400 square foot mansion in Miami for 455 Bitcoin which equated to roughly $6 million at the time of the purchase.

Property Coin will launch on February 26th to investors in and outside the US.