Blockimmo, Elea Labs and Swiss Crypto Tokens AG have closed the first ever real estate deal in Switzerland on a blockchain. 19 properties were tokenized, meaning a digital token now represents their asset value.
Blockchain property transaction platform blockimmo, proptech company Elea Labs and digital assets firm Swiss Crypto Tokens AG have closed a real estate transaction consisting of 18 apartments at Grabenstrasse 3, in the Swiss city of Baar, and a restaurant named “Hello World.”
The total token value was 3 million CHF, which represents 20% of the total property value. Four investors bought all tokens in a club-deal, according to blockimmo, in four separate transactions on the Ethereum blockchain.
Cooperation between blockimmo, Elea Labs, and Swiss Crypto Tokens AG
Blockimmo used its property transaction platform to tokenize the properties. The firm’s platform is based on the Ethereum blockchain and registered and regulated in Switzerland.
The entire transaction is essentially a Security Token Offering, just that the tokens are not linked to a company but represent a property, officially and legally valid under Swiss law.
Swiss Crypto Tokens AG, a subsidiary of Bitcoin Suisse, provided its stablecoin CryptoFranc (XCHF) to support the transaction. The coin is pegged to the Swiss Franc and enabled the transaction partners to avoid volatility risks.
“With the stablecoin CryptoFranc, we have developed a key piece of the puzzle for the Swiss blockchain ecosystem. Blockimmo has utilized this instrument perfectly to realize the future of real estate transactions,” explains Armin Schmid, CEO of Swiss Crypto Tokens.
The third company, Elea Labs, uses blockchain-technology to build a so-called “Property DNA” – a blockchain-based record of all the data about a property, secured and stored in a decentralized way. As part of the tokenization process, each of the 19 buildings received a unique DNA, including all building specific data sets.
“With the decentralized property register Property DNA, we enable users of the blockimmo platform to make a sound investment decision based on complete and validated property data. The Property DNA will allow for a transparent digital due diligence and will also simplify, accelerate and reduce the cost of processes,” said Martin Schnider, CEO of Elea Labs.
Just a first step; more properties will follow
Blockimmo commented this transaction was just the first step. The firm plans to tokenize more properties and sell the tokens through a “public crowdsale.” Eventually, the plan is to list them on a regulated exchange in the second quarter of 2019. The company says its goal is to make real estate investments as simple as buying digital currencies.
Bastiaan Don, founder and Managing Director of Blockimmo, says, “In Switzerland, you have a non-transparent market with asynchronous information that is difficult to access. These market features negatively impact the liquidity potential of the real estate market. By using blockchain technology, blockimmo enables a solution to a problem, representing a paradigm shift for real estate ownership and trading.”
The blockimmo team is also working on a decentralized exchange called STX.SWISS, which forms the basis for the planned system for tokenizing, investing and trading.
“With this market launch and groundbreaking first deal, this technology is now live. We are digitalizing real assets together with our partners. We are thankful for the opportunity to shape the real estate industry and the blockchain community in a sustainable way, and we look forward to the next step,” says Bastiaan Don.