According to reports, blockchain technology will improve the efficiency and transparency of real estate investment management.
Colchis Capital, an alternative investment firm, has teamed up with infrastructure provider Bison Trails to investigate the potential utility of Provenance blockchain in improving real estate management services, demonstrating yet another promising use case for distributed ledger technology.
Bison Trails will provide node infrastructure to San Francisco-based Colchis Capital as part of the partnership, the companies announced on Tuesday. Bison Trails, as a key infrastructure provider for Provenance blockchain, will also assist Colchis Capital in utilizing the technology to improve the efficiency and transparency of real estate investment management.
To ensure interoperability with Provenance, the investment manager is developing its own technology stack. The technologies will collaborate to provide investors with real-time reporting on cash flows and yields without incurring the costs associated with generating large data streams. The collaboration also paves the way for Colchis to investigate asset tokenization in the future.
Since July, Bison Trails has been providing infrastructure support to the Provenance blockchain. Provenance, an open-source ecosystem for developing financial services and DeFi apps, uses Bison Trails infrastructure to strengthen its network and support crypto holders who run validator nodes.
Coinbase purchased Bison Trails in January 2021 for an undisclosed sum.
Blockchain technology has been hailed as a potential solution to many of the issues confronting the real estate industry, including trust, transparency, contract processes, and cost. The technology is being promoted as a means of democratizing real estate ownership in an industry that has become increasingly restrictive to the general public.
For years, real estate tokenization has been discussed, but it has yet to emerge as a prominent use case for blockchain technology. Over the next five years, this could change as small segments of the global real estate market begin to use blockchain solutions. Moore Global, a London-based consultancy, recently forecasted that real estate tokenization could reach $1.4 trillion in the coming years.