Q: What is tokenization and how does this apply to real estate?
Tokenization is simply a secure process of storing economic value in a digital record, or token. Tokenizing a physical asset, such as a property, allows it to be made divisible and subsequently issued as digital tokens. These tokens are then recorded and transacted over a blockchain while still being represented by the underlying property.
Q: What is blockchain and does Vesta Equity’s marketplace run on it?
Blockchain is a powerful and revolutionary technology that allows digital records (data) to be made in a decentralized manner across a network (distributed ledger) and verified through consensus by multiple sources on the network. This prevents independent data warehouses from storing, manipulating, and creating monopolies over data for economic benefit. A very common type of data is a financial transaction, and on a blockchain this can be made using a digital token or a cryptocurrency. By using blockchain technology, Vesta Equity’s marketplace ensures that all transactions are fully auditable, immutable, and much quicker compared to traditional methods of transferring funds.
Q: What is a cryptocurrency, does Vesta Equity’s marketplace use them, and do I need to sign up for it?
A cryptocurrency is a digital currency with its own economic value that can be used for transactions over a blockchain or traded over exchanges. There are many different cryptocurrencies with a wide range of applications, and the most well-known examples are Bitcoin and Ethereum. Vesta Equity’s marketplace makes use of USD Coin (USDC), a type of cryptocurrency called a stablecoin which is pegged one to one (1:1) with the United States dollar. This means that one USD Coin will always be equivalent to one US dollar, making it an ideal currency to transact in. When money is moved into your wallet it is converted into USDC, and likewise, when money is moved out of your wallet it can be converted into US dollars or a fiat currency equivalent based on exchange rates. You do not need to sign up for USDC and your wallet enables you to transact in it automatically. In your user settings, you can express the currency you see on the platform as either US dollars or USDC. By using a stablecoin we ensure zero speculation or volatility.
Q: Can I transact my equity assets outside of Vesta Equity’s marketplace?
Equity assets purchased on Vesta Equity cannot be transacted outside of the marketplace. To convert equity, a liquidity event must occur which means that you must sell the equity proactively to other investors or it could be purchased through a property owner buyback term associated with the equity. Alternatively, the property itself could be sold in its entirety. In these scenarios you would receive the equivalent cash value and could reinvest in other properties or exit some of the proceeds from the sale event.
Q: What are Pera Wallet and MyAlgoWallet?
A wallet is a secure digital device or app used to store, send, and receive digital assets on a blockchain. Homeowners and investors will connect their wallet to the Vesta Property Marketplace, but will maintain full control over the contents of their wallets and the transactions made using their wallets. The Perra Wallet is a mobile wallet app that connects homeowners and investors with the Vesta Property Marketplace and the Algorand blockchain. For investors, a wallet is used to hold digital securities. For homeowners, a wallet is used to receive funds from investors. Click here for more information on how to set up a Perra Wallet.
For users who prefer a desktop application, MyAlgoWallet is also compatible with the Vesta Property Marketplace and the Algorand blockchain. Click here for more information on how to set up a wallet with MyAlgoWallet.
Q: What is Circle?
Founded in 2013, Circle is a global payments solution and stablecoin issuer based in Boston, MA. Circle enables businesses and individuals to conduct financial transactions on the blockchain because its faster, safer, and more efficient than traditional payment systems. The stablecoins issued by circle are built to a higher standard. That's why USD Coin (USDC) is always redeemable 1:1 for U.S. dollars. To increase transparency, Circle publicly discloses its reserve assets on a monthly basis. Investors in Circle include BlackRock, Inc., Fidelity Management and Research, and Goldman Sachs. In February of 2022, Circle formalized plans to go public at an estimated valuation of $9 billion. Circle's stablecoin, USDC is available on multiple blockchains, including Algorand which powers the Vesta Property Marketplace.