Key Metrics for Blockchain and Real Estate Integration w/ Algorands’ Barry Finkelstein
Mr. Finkelstein addressed the matters in which blockchain, specifically Algorand, believes there is potential for huge industry disruption. Peer proof of stake creates an efficient decentralized platform that creators can trust. Real estate can truly benefit from the speed and increasing levels of trust the low cost network provides. Fractionalization and democratization of investment opportunities, traditional finance will go to decentralized finance.
Barry Finkelstein, Head of Business Development in North America at Algorand. Barry Finkelstein is working with Algorand to lead its North American business development efforts and assist in capital markets initiatives. Algorand is a blockchain based platform that develops powerful, fast, inexpensive, and easy smart contract functions. Mr. Finkelstein was most recently at 23 Capital, a Sports, Music and Entertainment capital and solutions provider. Prior to joining 23 Capital in April 2017, Mr. Finkelstein was a Managing Director at UBS AG. He headed the Fixed Income Distribution/Structured Products and Solutions group. Mr. Finkelstein had responsibility for several senior institutional client relationships, primarily focused on structured products and solutions. Mr. Finkelstein focused on the origination, structuring and development of Structured Funding transactions and other capital raising endeavors for clients of the Bank. Mr. Finkelstein had management responsibility for the Structured Product Distribution and Solutions effort and had been a member of the UBS Fixed Income Executive Committee.
Key takeaways: Mr Finkelstein believes that real estate is a time proven asset, with historically positive returns minus some rebounds. Real estate creates a store of wealth and is a tangible asset. It creates other things around it to grow. Hence the emergence of lending, borrowing, and securitization over time. These are direct products of the real estate that is built. But these businesses can be represented on the chain and new assets can be derived off of these business practices.
He warries that the current state of these transactions in the industries are held in an inefficient way. There are inefficiencies when it comes to trust, documentation, and high transaction fees. How can blockchain fix this? The immutability of the blockchain eliminates a big transparency issue and can offer better regulation for compliance and laws because actions cannot be hidden. Tokens create more accessible ownership, fractionalization the real estate assets’ ownership, and utilizes smart contract technology.
Real estate is largely an illiquid investment, although we have created some liquidity for parts of the asset class, it still remains mostly illiquid. With proper and compliant creation, Mr. Finkelstien uses an example pertaining to the dilemma of valuing the equity in a given asset. Lots of hoops and hurdles to access this. Tokenization for equity in real assets is possible through this network. No banks or intermediaries, and defi creates efficient pathways for borrowing and lending. Increase the liquidity and use it as collateral, commerce, or currency for tradeable tokens.
The blocks are created by transactions and the smart contracts embedded in them create if, then statements that give the tokens a function on the chain. This creates an immutable piece of ownership on the blockchain with no middlemen required to prove ownership. Smart contracts can also be programmed to be custom to any specific and detailed task the creator wants.
Think of Algogrand as technology company, like IOS to Apple and Android to Samsung. Algorand is built for transaction ability promoted by low cost, speed, and security. Silvio Micali, founder of Algorand, introduced zero knowledge proofs for functionality on the blockchain. At first, defi, security, and scalability could not interact together in the same network. Only 2 could function. This was disproven, and soon a fast and cheap cryptographic verification model was discovered. Hence, the birth of Algorand.
The proofing mechanism is peer proof of stake. Why this proofing mechanism is unique and revolutionary is because it does not fork and has been proven and verified to never fork. Algorand is a highly functional layer 1 program, a limited knowledge coder can create a token on the network. The functionality can be built into the layer 1 and you can control the rights as a function.
Mr. Finkelstien believes whole-heartedly that Algorand offers a fantastic platform for not only real estate, but also Finance in general.
Key references: The Blockchain Real Estate Summit Speakers List, Listen to Barry Talk about Algorand’s platform, Algorand’s Website (check this out), Algorand Layer 1, What is a fork
TLDR: The reason Mr. Finkelstien believes in Algorand’s platform for the future of finance is it’s ability to make decentralized, secure, and scalable functions on the blockchain. This network creates an easy to use ecosystem. Peer proof of stake makes it a reliable and trust worthy system for developers. There are many great philosophies behind the functionality of Algorand. Check out their whitepapers.
This article is brought to you by the Team at SafeREIX. SafeREIX is a community defi token that is built around the integration of real estate to the blockchain. As real estate professionals, we aim to reach those engaged with real estate or blockchain and get both parties to talk about what the separate industries can do together. We had a great time writing this article for you to read. We are so excited to keep bringing you articles just like this one. We think that writing articles of this nature will expand our reach through the foundation of community enrichment. Hope you enjoyed this article, and we will keep you updated when the next piece of content is ready for your engagement. Join us on our social networks to stay connected!
Speaker socials: Barry Finkelstein
Author: Zach Cuellar (Website, Twitter)
Editor: Hunter Carter (Twitter)