Real Estate Investor Magazine South Africa June 2018 | Page 61

INVESTMENT VEHICLES wildly successful at something to even get your foot onto the ladder. A new way Redistributing that opportunity through a new-age fractional ownership model is one of the fundamental principles behind the cryptocurrency revolution playing out right now. Enter Australian-based Bitcar, recently voted as the most promis- ing Initial Coin Offering (ICO) of 2018 at the largest crypto gathering of the year, Consensus 2018 hosted annually in New York. Of course, fractional ownership models of making major in- vestments such as these already exist in the traditional fields of finance. But you still need a fairly significant chunk of change to get on to such platforms, as well as a relatively well-heeled circle of friends and acquaintances to boot if you’re to be certain of receiving your fair share of returns. Brokers who do this job as a profession are available, of course to handle the actual nitty-grit- ty of the deal, but they charge fees and commissions which eat into the profit being scored. Bitcar, on the other hand, allows for minute fractionalisation of the asset base so that even small-time investors with just a couple of Ether or tenths of BTC at hand can participate in investing in this highly lucrative asset class. And because the ecosystem is based on the Ethereum network, smart contracts ensure that each investor from whales right down to minnows are allocated their fair share at the end of the term. How it works You’re welcome to read the full details of the offering on Bit- car.io, but let’s simplify it here. The aim of this interesting ICO is to raise at least USD10-million through an ICO sale to ac- quire a fleet of luxury and exotic cars as an investment. These vehicles will then be stored in a public location, and token holders will be able to participate in all decisions relating to this pool of value. Because the asset on which the value of the token is based is physically real, that means that each token should appreciate in value naturally reflecting the appreciating value of the assets themselves. In addition, these tokens will be tradeable through exchanges, so market speculation could also further leverage the value of each token. There will also be a second level of Bitcar tokens made avail- SOUT H AFRIC AN www.reimag.co.za co.za eimag. www.r SOUT H AFRIC AN SO UT H AF RI CA N www.reimag.co.za © © H SO UT N AF RI CA www.r eimag. © co.za © YOUR FI FREE NANCIAL Gettin DOM GU OLIO property g a foothold on IDE Property WORL YOUR Hotspot D s PORTF Abound ladder the COMMERCIAL TRENDS Multiple Opportunities SMART Cape Town CBD Spike REAL ESTATE TECHN PR Ma New Disruptors in the OLOGY ke more mo OPERTY M t Game AR ney in Trans the Investmen Game 2017 KETE form OFFSHO Master PROPE RS Your Wealth RE RTY PRACT UK & Investor Major Changes Afoot ITIONER’S US BILL Touch e Midas RISK VS RETURN with th MIK W E ARREN VESTOR Gifted EAT IN E A GR n IN PROPERTY BECO st M Practices to Wi YOUTH ATUS their Space ST Claiming 6 Be OF JUNK ? 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VAT) 09 3 SAPOA WINN JOURN ER ALISM AWAR DS Prope Publication rty of 2013 & the Year 2015 Effectiv Highly e Truste es Fixing up Jozi able to owners of the initial coin. CAR tokens will represent actual physical ownership of individual vehicles on the platform and at the end of the term of each asset (5 – 15 years) users holding the majority of a certain vehicle’s CAR tokens will be able to choose to take ownership of the vehicle itself, presum- ably paying off the balance to smaller holders of the same vehi- cle and burning those tokens in the process. Explains Daniel Woodroof Bitcar Executive: “Never before has such a large market been inaccessible to so many — and that inaccessibility is what BitCar aims to disrupt and change. As an asset class, this market has outperformed the S&P 500, DJIA, gold, silver, REITs, private equity, hedge funds, and commodi- ties over the last 12 years.” Unfortunately the amount of uncertainty a nd fear surround- ing the crypto industry today can make ambitious ICOs like this one, with their lofty goals and frank assessments of existing challenges faced, sound a lot like just another crypto scam. And even with Bitcar tokens now available on selected crypto ex- changes, this project could still turn out to be just that. However, the foundational thinking the model represents should not be dismissed quite so easily. Imagine applying a similar approach to property as an asset class. There are no shortage of property-backed ICOs doing the rounds. The high degrees of regulation and legislation, however, make new models such as this one difficult to actually imple- ment. Still, consider the notion as, let’s say, a mechanism im- plemented with the aim of resolving our country’s current land expropriation debates. The fact is that, speaking from a purely technological stand- point, it could certainly work. It could even achieve the goals of the Bitcar founders and open markets traditionally accessible only to the top percentiles of wealth to the mass market. Bull or bear, the finance models being introduced to the world today by blockchain are startlingly workable. Even the specialised field of exotic vehicle trading can and will be disrupt- ed. Maybe not today and maybe not next week, but by the time of our children, digital assets will be universal in some form or another. While things like the car, as an asset class, will integrate and even be enhanced as an investment opportunity by the new opportunities this presents. Take your business or development to the next level Advertise in a leading property magazine. 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