Ulrich Schüppler asked Michael Stephan about blockchain technology in the real estate industry. Read here the key messages of this interview.
Quotes from Michael Stephan, Founder and Managing Director of iFunded:
Blockchain has huge benefits
“Since the middle of last year, we’ve been looking at all conceivable applications of blockchain and smart contracts, and overall, I see tremendous benefits for the real estate industry in the blockchain.”
Investment process becomes faster and safer
“Smart contracts, which are part of the blockchain technology, can make the entire investment process faster and more secure, eliminating the need for middlemen such as payment service providers or trustees to cut costs, and reducing the investment process within days be processed within a few hours. ”
Real estate investments become significantly more liquid
“Transforming real estate into so-called tokens is a very big opportunity, and these digital shares are decentralized on the blockchain tradable on relevant digital exchanges, meaning they can be traded 24 hours a day worldwide. Regardless of stock market opening hours immensely increased this otherwise very illiquid asset class.”
It is a legal and not a technical challenge
“The biggest bottleneck is not the technical, but the legal challenges: Technically, for example, a smart contract solution for investment management or seamless mapping of real estate DNA – the core data – could be implemented very quickly legally structured so that related transactions are also accepted by regulators.”
It will not change everything immediately
“Anything that touches on legal historical idiosyncrasies will not change immediately – take a lease payment where the landlord accepts cryptocurrency – that’s a question of maybe a year or two, but let’s assume that ownership also matters if a property is technically ready to be displayed on the blockchain, the legal transfer without a notary will probably take much longer in Germany, for which our legal system is not yet designed and the notary lobby too strong.”
You can read the complete interview on the website of the real estate newspaper Immobilien Zeitung in German.