Investment firm Eurion Capital is trying to shake up the real estate market by letting its ERN token holders vote on property plays.
The move comes amid a renewed push by crypto firms looking to bring "tokenomics" into real-world assets – an endeavor that has mixed results in crypto. Tokenomics is a catch-all for the elements that make a particular cryptocurrency valuable or interesting to investors, including token supply, utility, etc.
But the new Ethereum-based token from Eurion is not trying to give investors an ownership stake in Swiss chalets or city skyscrapers, as previous crypto real estate efforts have pursued. Instead, it will approach a simpler, less regulatory complex use case: influence.
“We're not tokenizing assets, so they don't own anything," the firm’s CEO, David Niewiadomski, told CoinDesk in an interview, explaining “ the focus is on giving “decision-making” powers to token holders.
The ERN token, which will be listed on Uniswap, will give its secondary owners an irrefutable vote in Eurion's investment decisions, Niewiadomski told CoinDesk. He believes that the token is not a security as per U.S. law.
The firm is setting a minimum target of $4.5 million, he said, adding that the total supply will be capped at 1 billion tokens.
Without delivering ownership to its holders, the token will hold its value through buybacks that “will raise its floor price over time," according to its press release.
“As profit is generated from investor selected assets, a portion of that profit will be used to buy back tokens that can never be sold. This will in turn decrease circulating supply. So over time the amount that is bought and cannot be sold will grow as the portfolio of investor selected assets grows," Niewiadomski said.
The fund will use royalties generated from token resales to bankroll its real estate buys. It will target urban and their suburban markets in the southern U.S., including Florida cities Orlando, Tampa and Miami, according to its website.
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