Abstract Tokenization is a financial technology company developing an end-to-end Tokenization as a Service (TaaS) platform for commercial real estate sponsors & investors that operates with smart contracts & distributed ledger blockchain technology. The company helps automate the technical, legal and operational functions of a CRE security token offering to raise capital and convert traditionally illiquid securities into tradeable tokens enhancing liquidity. Abstract additionally plans to build a secondary trading platform (ATS) for real estate backed security tokens.
Only $1.4 trillion out of $217 trillion in total global real estate assets was exchanged in 2017 according to Savillis Research / Oxford Economics. Abstract is solving for the lack of liquidity and unlocking $4.275 trillion of liquidity premium from the $19 trillion in investable, high quality global commercial real estate. By definition, when privately held real estate starts getting tokenized, it will rise in value as investors pay for liquidity. Economists estimate the cost of illiquidity at between 15-30%, Abstract Tokenization is unlocking this massive liquidity premium.
In addition to liquidity challenges, traditional CRE primary issuance, record keeping and investor servicing processes are currently inefficient, with portions often still being done manually. The company is addressing these issues with smart contract driven automation, beginning with automated reporting & distribution processing built into each security token issued. In short, Abstract is creating the infrastructure and tools to make it easier for the CRE industry to evolve into the digital age of security ownership.