Real estate is one of the most valuable investment vehicles in the world, with a total asset value of more than $326.5 trillion. This is greater than the value of all the stocks, shares, and bonds in the world combined.
There’s only one problem with real estate investing—it isn’t cheap. Take the housing market, for instance. Prices smashed past the 400k mark, the highest it has ever been. Although housing prices are cooling, they are still out of the reach of most investors.
Thankfully, there’s a solution at hand: United States Property Coin (USP). It is a digital token that is positioned to provide qualified investors with the ability to invest in real estate fractionally using Web3 technology. USP uses a fractional ownership model, which is excellent for low-cost investing.
This article explains how United States Property Coin (USP) is making real estate investing accessible to most people through blockchain innovation.
But first…
What is USP?
United States Property Coin (USP) is a security token backed by real estate assets in high-demand areas of the United States. It uses institutional-grade blockchain technology that, when used correctly, meets the requirements of existing securities law and regulation.
USP blends innovative blockchain technology with a time-tested investing strategy to make the potential of real estate’s return on investment more accessible to a new generation of real estate investors who are not subject to the same barriers to entry as those who came before them.
Primior, a luxury real estate investment, development, and asset management firm in Southern California, backs USP. The main objective and vision of USP is to offer investors a more liquid, asset-backed, transparent alternative to stablecoins and a superior store of value.
Investors may use USP as a safe way to store capital because investors will retain fractional ownership in a portfolio of real estate assets expected to generate income and increase in value over time.
How does USP work?
Blockchain refers to a distributed database that acts as a digital ledger of security tokens. USP is a security token that registers your fractional ownership of a real estate portfolio, which is represented by your ownership of the USP token.
The blockchain network (in the case of USP, the Ethereum Mainnet) keeps a record of the real estate tokens, instantly validating, synchronizing, and sharing with all participants. This creates a transparent, immutable, and verifiably correct public record of all tokenized property transactions.
USP token holders get a share in a portfolio of real estate properties located in major US cities (currently, our assets are local to Southern California, but we aim to branch out geographically in the future) with a strong demand for housing. To achieve this, USP creates a digital currency backed by a pooled ownership interest in real estate assets and offers it to investors via a security token offering (STO).
Unlike other cryptocurrencies backed by real estate, USP securitizes a portfolio of assets instead of individual properties. Investors in this token also get paid dividends in USP rather than USD.
How USP makes real estate more accessible
By bringing together real estate investing and cryptocurrency, USP is revolutionizing the industry. USP introduces blockchain technology to the property market by offering fractional ownership of real estate assets in high-demand locations across the United States. Here are some ways USP increases the accessibility of the real estate industry:
Lower barrier to entry into the real estate market
USP lowers the barrier to entry into the real estate market for beginner investors, making it possible for them to purchase fractions of more significant properties. By issuing tokens that represent a fractional stake in USP’s portfolio, multiple investors can share the ownership of the property and benefit from shared rental and market appreciation.
Conventional real estate investments usually demand far more funds upfront. With USP, you can still take advantage of the potentially significant returns.
Management, transparency, and security
Selling a property to another party in traditional real estate usually involves lengthy paperwork. This is a traditionally slow process. However, exchanging tokens between any two users on the blockchain is a lightning-fast operation that can occur in any country, at any time of day, without an intermediary.
Compared to the time-consuming and cumbersome method of dealing with paper documents, USP affords investors a more pleasant post-issuance management experience. Blockchain allows investors to permanently store information like contracts, documents, and the company’s cap table (which will be accessible through the USP Investor Portal when it is launched).
The blockchain stores all the necessary information related to the token and is accessible to anybody with a stake at any time. In practical terms, this streamlines the settlement process and mitigates the perils of storing paperwork.
Inflation hedge
USP aspires to emerge unparalleled in terms of value preservation. The developers of USP envisioned it as the silver bullet to the volatility of the dollar-backed stablecoins, utility tokens, and algorithmic-backed coins by backing it with real estate assets in major urban markets across the US.
The security token would gain from the immediate cash flow and the long-term investment appreciation of real estate in the US. If anything, the real estate industry has proven its worth over the years, registering steady growth.
The combination of a stable income stream, the long-term value of US real estate, and the everyday peer-to-peer rapid exchange network created by blockchain technology positions USP as a viable store of value.
Liquidity creation
Traditional real estate has always been a low-liquidity investment. Costs typically run high due to the number of people and the documentation involved; it involves more individuals than businesses.
Using blockchain technology, you can transfer tokens quickly, safely, and with no third parties involved. That empowers you to diversify your portfolios faster, reduce risk exposure, and increase your real estate market liquidity.
As a result, USP in theory should allow for a higher level of liquidity than traditional RE investing by making the process of exchanging and tapping into stored value easier and more accurate with blockchain technology.
Reduced transaction costs
Blockchain technology simplifies investment transactions while reducing transaction costs due to its automated processes and permanent, unchangeable digital record. You could also potentially get higher profits since you can complete investment transactions more quickly and at reduced costs to all parties.
While REITs offer a comparable value proposition, they demand a significant initial commitment and various up-front fees.
When you invest in USP, you can monitor capitalization tables in real time, as it offers a convenient investment platform where you can track your investment.
No management hassle
While you will technically become a landlord thanks to your fractional ownership of USP’s diverse real estate portfolio, you don’t suffer from the downsides of being a landlord – including property and tenant management.
All properties in the USP portfolio are professionally managed by Primior, USP’s backing company. Primior has a track record of developing and managing more than $1BN worth of real estate assets, so USP token holders can rest assured that the properties they own a fractional stake in are in good hands.
Proof of ownership
The real estate industry has its fair share of property rights and ownership conflicts. Such issues will drain your resources and time as you resolve them.
Not so with USP token holders.
USP secures data storage in blockchain ledgers, making it inaccessible to outside parties. That means no one can dispute your fractional ownership of the portfolio of real estate properties. In addition, all owners of USP must be KYC verified, meaning USP knows exactly who owns the tokens at any given time, and how those tokens are being used.
Diversification and increased market access
Real estate investing is a competitive field, and only those with the necessary expertise and resources may participate. But USP expands the pool of investors so that anyone with access to the internet and sufficient funds can buy, trade, or keep real estate assets regardless of their physical location (so long as they qualify under Regulation D Rule 506(c) or Regulation S).
USP opens up a world of possibilities for investors by giving them entry to various properties in various prime locations. Investors can diversify their portfolios as the USPs portfolio of assets contain investments in several real estate forms, including commercial, hospitality, and multifamily units.
Diversifying investment portfolios across many locations and markets also increases your financial safety net by providing exposure to different economic growth factors.
USP makes the prospect of commercial real estate investments in many different cities and countries a reality. You don’t need to be near a property to buy tokens for it once you become a USP investor.
Why We Think USP is the Future of Real Estate Investing
Of the $16.4 billion invested in security tokens, real estate investments accounted for about 1.2% of that total. Even though it may not seem like much right now, this is the fastest-growing sector of the security token market and therefore warrants particular attention.
Regarding property investments, we believe both USP and security tokens as a whole are the cryptocurrencies of the future.
Instead of being backed by a volatile fiat currency, USP draws its backing from the steadily appreciating value of a large urban real estate in the US.
We expect the value of the USP to grow as its pegged on the real estate industry, which has registered a 5.32% yearly growth from March 1992 till March 2022 – however, we responsibly invite potential investors of USP to always perform their own research and seek their own investment advice.
Bottom line…
As far as investing in income-generating properties on the blockchain, United States Property Coin (USP) is positioned to be quite a game-changer. Token holders will have a stake in a broad portfolio of multifamily housing developments, healthcare institutions, and hospitality properties across major cities in the US.
USP is charting new territory, allowing a new generation of investors to try their hand at real estate investing without the shackles of high barriers to entry.
