RealBlocks, a real estate platform backed by blockchain technology, has recently announced that it has raised $3.1 million in a seed funding round. The startup plans to use the capital to build a seamless "tokenized" investment and fundraising feature for the real estate sector.
RealBlocks operates by providing access to private equity in real estate properties by turning them into tradable securities based on blockchain assets that represent microshares. The process, the company says, allows for easier investments by allowing firms to purchase shares directly with U.S. dollars or cryptocurrency.
“With the support of our strategic investors, we’re accelerating development of our product and adoption of blockchain technology for real estate, an industry that previously hasn’t seen much innovation,” said Perrin Quarshie, founder and chief executive of RealBlocks.
The round was led by Science Inc. with participation from Morgan Creek Digital, Zelkova Ventures LLC, Ulu Ventures LLC and Cross Culture Ventures.
“We believe that the real estate market, like nearly all asset classes, will be increasingly data-driven and digitized or digitally native,” said Greg Gilman, co-founder and managing director of Science Inc. “This use of blockchain technology has real-world benefits that perfectly align with our investment model.”
The global real estate market is massive: the 2018 annual MSCI Real Estate Market Size Report estimated that the industry saw $8.5 trillion globally during 2017 in professionally managed investments.
According to RealBlocks, approximately $145 billion of that market is trapped in what the company calls “illiquid capital investments” that could be, in part, unlocked with its tokenization platform.
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