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Over the past few years, cryptocurrency – virtual currency that uses blockchain technology as its backbone – and Initial Coin and Token Offerings, have emerged as new funding mechanisms for firms looking to raise money for ventures and projects. This paper is an exploratory study of the potential for this technology to be used to increase investment in sustainable real assets.
The first section of this paper provides an overview of sustainable real assets. It also identifies the current investor landscape for these types of opportunities. This landscape is dominated by high net-worth individuals and institutional investors, primarily as a result of the high cost of entry and complexity of transactions. The author also looks at recent technological and regulatory changes that have allowed for smaller investors to get exposure to real asset investment opportunities through crowdfunding.
The second section gives an overview of blockchain technology and cryptocurrency. It also reviews Ethereum, Initial Coin and Token Offerings, and addresses some of the potential risks of this new technology. In the third section, the author examines two firms developing blockchain based technology, that will potentially allow for the sale and purchase of real sustainable assets on their platforms.
Discover the features and attributes of blockchain and cryptocurrency that can potentially reduce the barriers to investing in real assets and sustainable real assets. Examples include smart contracts, ERC-20 tokens, and tokenisation.