[ANN] Real Estate Blockchain Crowdfunding Technology

[panorama]

I've been thinking about the risk/return side a little more. By investing in REAL, you're buying into EU real estate (although we don't really know what country for sure). It also sounds like it'll likely be hotel investments. Let's put aside the possibility that they are actually just going to sell you a property they already own.

Holding on to tokens is therefore a hedge against crypto investments. Essentially you're saying you'd rather sell some of your cryptos, convert it to fiat (Euros) and buy real estate. You're betting that the 12% - 20% returns they are targeting is better than you can earn in cryptos on a risk-adjusted basis.

Assuming they will be buying hotel assets, it's likely a bet on the economy (although we don't know which one). Most hotels either target business travelers or tourists, but both depend on a strong economy. So, in order for your investment to do well, the dependant economy has to do well.

It sounds like you won't have to buy into each investment they propose, but since they didn't raise that much money, I don't know how many choices you'll have. If you don't like their first investment, you can hold onto your REAL tokens instead of buying RPPs, but then you're not earning a return on your money, so it's just tied up.

Of course, if the Euro isn't your local currency, then you're you're taking that currency risk as well.

I know nobody asked the question, but I find this ICO fascinating and it's helping me become a better ICO investor as I think about what I'd REALLY be buying into.

[panorama]

Here late...So it sounds like (one of) the big problem(s) with this project is that REAL team needs to adjust the core operating budget to become more proportionate with what was actually raised at ICO.  

They don't need all of the employees they have for 4 years straight, especially when that's soaking up the large majority of the budget.

I don't knock REAL for the budget because they were transparent about it, so there's enough info for any diligent investor to know what they're getting into here.  That doesn't condone it though, and to me it looks like, FOR THE GREATER GOOD OF THE REAL COMPANY, positions and/or salaries need to be shaved.  REAL should work within their means.  

It's more important to have capital to invest on real estate than to use the large majority of the budget on anything that doesn't directly return income.  

If REAL is counting on the token to grow in order to invest in real estate, that won't work if the returns to the token holders are laughable.

Assuming I didn't miss it, REAL should address the budget situation for the community in a upcoming blog report of some sort.

You're right in the sense that they have to adjust their budget. Otherwise the business falls apart since they won't have much money to actually buy real estate. However, it's not clear if they'll be able to actually execute their strategy with too small of a budget.

Regarding your last comment about needing the price of REALs to appreciate so they have more money to invest, you're looking at it the wrong way. It has zero impact on how much they can invest since they raised a fixed amount of ETH and that's what will be used. A higher price would help the team members personally (not investors) since that's how they received their 20%

That being said, they could sell the reserve tokens, so a higher price could help in that respect.

The budget is really the big question since the REAL token value is highly dependent on this. The higher the budget, the lower the value of REAL tokens. It's a balancing act since they didn't raise as much money as expected, but they still need money to run their business.

It was really a poorly structured ICO because they set it up to disadvantage early investors. That's the opposite of how it should have been run. This is aside from the fact that they didn't provide enough info on the real estate side of the business, which is really what token holders bought in to.

The ONLY things that should matter to token holders is the real estate investment strategy and how any non-investment money is being spent/allocated. They screwed up both, which I suspect is why they didn't raise enough money. There should have also been a minimum amount they need to raise or have everyone refunded. Because they didn't do that, they now have the issue of having to drastically reduce their budget, which is a HUGE problem.

At some point, a real estate company will put together an ICO  the right way, so that's what you want to keep an eye out for if you're interested in the space.

Ahhhh...I think I must've misread something in the last few pages because I thought someone mentioned that some of the REAL tokens the team kept would be used above the ETH raised for real estate (push come to shove).  I didn't invest in the ICO and I'm just kinda starting to dig into the whitepaper so I was more so going off the convo I interpreted here.

Considering the current financial state of REAL and some of the profit projections they make on investment (I believe 10%), what would you say the tokens are worth in your mind at this time?  I mean without a budget change, if we were to project how long it would take to get ROI, it seems like we're talking a pretty long time.  I'm starting to think REAL may even touch .20-.30 cents now  

It sounds like you were right how you interpreted the conversation. The reserves can be sold to new investors in the future, which would raise additional ETH.

Regarding the valuation, it's impossible to know what's a fair price until we get the following info:

* An updated budget
* More info on how the reserves work and how much is actually set aside for future investment (vs any non-investment expenses)
* Estimated timing on their first property purchase
* Much more detail on their real estate strategy and their previous experience implementing that strategy.
* it would be helpful if they could also confirm how much ETH and fiat they currently hold. I have a pretty good idea based on the ICO results they posted, but confirmation would be helpful.

Without having any of this info, I'd say the max price right now is about $0.20 if the budget is still $8 million and assuming they will acquire their first property very soon.

My guess is that they are working on reducing their budget. That would raise my estimate IF I thought they could still pull off their business plan based on the new budget, so there's a balancing act there.

It doesn't really take many people on the real estate side to acquire and manage just a few properties (in my opinion), but the tech side adds a lot of bloat that most real estate firms don't have to carry.

Of course, if they were to reduce the number of people they hire, you'd expect a commensurate reduction in the amount of REAL set aside for the team. Otherwise all the remaining people end up getting more.

I'm adjusting my price estimate. The team has confirmed there's 15 million tokens that will be in circulation, not counting the ones being reserved for a future sale (or possibly burned). They raised around 37,000 ETH.

Putting the budget issue aside for a moment, the MAX price is 0.0025 ETH/REAL. That's just simple math. 37,000 ETH divided by 15 million tokens.

Of course not all of the 37,000 ETH will be used for investment since they need to set funds aside for the Operating Budget. We know they were originally budgeting $8 million, but that's way too much considering the value of the ETH they are holding is around $11.1 million. I'm assuming an ETH price of $300, even though it's trading lower today.

They haven't released the new budget yet, so that's the big question. The last trade on EtherDelta was at 0.00128. This implies that the company will invest 19,200 ETH and 17,800 is being set aside for the budget. That's $5.3 million, or a little more than $1 million per year.

I can't say if this is a reasonable budget or not, but that's what's being priced if you just look at the amount of ETH they are holding. Of course, there are other considerations, many of which I've outlined in previous posts.

I'm still keeping an eye on this, but I've decided that it's still too expensive for me right now. Until the new budget is released, my buy price is probably around 0.0005.

[ammosov]

I've been thinking about the risk/return side a little more. By investing in REAL, you're buying into EU real estate (although we don't really know what country for sure). It also sounds like it'll likely be hotel investments. Let's put aside the possibility that they are actually just going to sell you a property they already own.

Holding on to tokens is therefore a hedge against crypto investments. Essentially you're saying you'd rather sell some of your cryptos, convert it to fiat (Euros) and buy real estate. You're betting that the 12% - 20% returns they are targeting is better than you can earn in cryptos on a risk-adjusted basis.

Assuming they will be buying hotel assets, it's likely a bet on the economy (although we don't know which one). Most hotels either target business travelers or tourists, but both depend on a strong economy. So, in order for your investment to do well, the dependant economy has to do well.

It sounds like you won't have to buy into each investment they propose, but since they didn't raise that much money, I don't know how many choices you'll have. If you don't like their first investment, you can hold onto your REAL tokens instead of buying RPPs, but then you're not earning a return on your money, so it's just tied up.

Of course, if the Euro isn't your local currency, then you're you're taking that currency risk as well.

I know nobody asked the question, but I find this ICO fascinating and it's helping me become a better ICO investor as I think about what I'd REALLY be buying into.

One upside that can be in this is that Spanish RE market fell significantly. However, it did not recover since circa 2008. Additionally, REAL is based in Catalonia which is an uncertain place given its soft independence revolt. 

[Rijakolus]

Guys, has the team from REAL MARKETS said anything at all abut what d fak is going on? A dont see any involvement from the team...? Any new exchanges comming up anything? Kinda nerves i invested alot of money into this....

[Teagannr]

Like your work, devs, what news about beta?

[panorama]

One upside that can be in this is that Spanish RE market fell significantly. However, it did not recover since circa 2008. Additionally, REAL is based in Catalonia which is an uncertain place given its soft independence revolt. 

Actually, that should have no impact on REAL token prices. They are only a store of value that gives you the right to buy RPP tokens.

Until they start making investments, there's just cash (or ETH) sitting in the accounts. Why would anyone pay more than $1.00 for $1.00? Even if the prospect of them making investments is great, you don't know that you'll actually get a piece of it. REAL token holders will be competing to buy RPP tokens, so you're not guaranteed to get a piece of a great deal just because you hold REAL. For that reason, I think the RPP tokens will be more representative of the real estate prices / opportunities.

There will likely be an inverse relationship between REAL and RPP once they start making investments. In aggregate, the value of RPPs should approximately equal the value all the real estate they own. If the RPPs are undervalued, people will pay more for REALs for an opportunity to buy in. If RPPs are overvalued, the price of REALs should go down.

Remember, right now the value of all REAL tokens combined should be equal to the value all the cash/ETH they hold. As they invest everything into real estate, the value of all the REAL should be somewhat equal to the value of all the real estate. Same with the RPPs. Short term deviations in price can happen, but you'd expect them to self-correct as people notice they can buy $1.00 of real estate for $0.75.

[telegdyd]

Guys, has the team from REAL MARKETS said anything at all abut what d fak is going on? A dont see any involvement from the team...? Any new exchanges comming up anything? Kinda nerves i invested alot of money into this....

Relax, I also invested in Real a lot, when they release the platform, we will get back their investments with interest

[YGung]

One upside that can be in this is that Spanish RE market fell significantly. However, it did not recover since circa 2008. Additionally, REAL is based in Catalonia which is an uncertain place given its soft independence revolt. 

Actually, that should have no impact on REAL token prices. They are only a store of value that gives you the right to buy RPP tokens.

Until they start making investments, there's just cash (or ETH) sitting in the accounts. Why would anyone pay more than $1.00 for $1.00? Even if the prospect of them making investments is great, you don't know that you'll actually get a piece of it. REAL token holders will be competing to buy RPP tokens, so you're not guaranteed to get a piece of a great deal just because you hold REAL. For that reason, I think the RPP tokens will be more representative of the real estate prices / opportunities.

There will likely be an inverse relationship between REAL and RPP once they start making investments. In aggregate, the value of RPPs should approximately equal the value all the real estate they own. If the RPPs are undervalued, people will pay more for REALs for an opportunity to buy in. If RPPs are overvalued, the price of REALs should go down.

Remember, right now the value of all REAL tokens combined should be equal to the value all the cash/ETH they hold. As they invest everything into real estate, the value of all the REAL should be somewhat equal to the value of all the real estate. Same with the RPPs. Short term deviations in price can happen, but you'd expect them to self-correct as people notice they can buy $1.00 of real estate for $0.75.

Are you saying this from REAL's standpoint or how the market should value the coins?   What it "should" be just doesn't apply here to me because its based on an overpriced ICO.

[panorama]

One upside that can be in this is that Spanish RE market fell significantly. However, it did not recover since circa 2008. Additionally, REAL is based in Catalonia which is an uncertain place given its soft independence revolt.  

Actually, that should have no impact on REAL token prices. They are only a store of value that gives you the right to buy RPP tokens.

Until they start making investments, there's just cash (or ETH) sitting in the accounts. Why would anyone pay more than $1.00 for $1.00? Even if the prospect of them making investments is great, you don't know that you'll actually get a piece of it. REAL token holders will be competing to buy RPP tokens, so you're not guaranteed to get a piece of a great deal just because you hold REAL. For that reason, I think the RPP tokens will be more representative of the real estate prices / opportunities.

There will likely be an inverse relationship between REAL and RPP once they start making investments. In aggregate, the value of RPPs should approximately equal the value all the real estate they own. If the RPPs are undervalued, people will pay more for REALs for an opportunity to buy in. If RPPs are overvalued, the price of REALs should go down.

Remember, right now the value of all REAL tokens combined should be equal to the value all the cash/ETH they hold. As they invest everything into real estate, the value of all the REAL should be somewhat equal to the value of all the real estate. Same with the RPPs. Short term deviations in price can happen, but you'd expect them to self-correct as people notice they can buy $1.00 of real estate for $0.75.

Are you saying this from REAL's standpoint or how the market should value the coins?   What it "should" be just doesn't apply here to me because its based on an overpriced ICO.

I'm saying this how the market should value the coins, which has nothing to do with what the ICO price was.

By definition, if REAL tokens give you claim to (estimated)  19,200 ETH they are holding for investment, that's what the aggregate value of the tokens should be. Across 15 million tokens, that's 0.00128 each. This is a huge discount from the ICO price because there's a big loss of funds associated with team compensation and other costs.

I wasn't clear enough in my previous post. The sentence you highlighted should have said:

"the value of all REAL tokens combined should be equal to the value all the *INVESTABLE* cash/ETH they hold".

You could apply some other discounts, but I'm just trying to figure out the absolute max price this token could be worth right now. My point is it would be irrational for anyone to value it for more than the amount of investable cash they hold. Anyone waiting for the price to recover to the ICO value is out of their mind because that would be assuming the 37,000 ETH raised is still available for investment. In reality a much smaller amount is available.

I'm surprised more people aren't flipping out over this.

[mandibleclaw]

New blog post today https://medium.com/@real_token/crypto-markets-and-real-progress-384f8943cef8

[ammosov]

New blog post today https://medium.com/@real_token/crypto-markets-and-real-progress-384f8943cef8

TL:DR No we are still here, sort of

[fb92]

New blog post today https://medium.com/@real_token/crypto-markets-and-real-progress-384f8943cef8

Just stating the obvious about converting ether to fiat at the highest possible short term price. Good to see they are posting something, atleast.

[panorama]

New blog post today https://medium.com/@real_token/crypto-markets-and-real-progress-384f8943cef8

Wow...they really didn't say very much

[guillzini]

New blog post today https://medium.com/@real_token/crypto-markets-and-real-progress-384f8943cef8

Wow...they really didn't say very much

They actually didn't say anything useful in my opinion.
They only semi-useful thing I've read was the announcement of new budget and platform developments soon. I'm very curious

[BonTonPlease]

I've been thinking about the risk/return side a little more. By investing in REAL, you're buying into EU real estate (although we don't really know what country for sure). It also sounds like it'll likely be hotel investments. Let's put aside the possibility that they are actually just going to sell you a property they already own.

Holding on to tokens is therefore a hedge against crypto investments. Essentially you're saying you'd rather sell some of your cryptos, convert it to fiat (Euros) and buy real estate. You're betting that the 12% - 20% returns they are targeting is better than you can earn in cryptos on a risk-adjusted basis.

Assuming they will be buying hotel assets, it's likely a bet on the economy (although we don't know which one). Most hotels either target business travelers or tourists, but both depend on a strong economy. So, in order for your investment to do well, the dependant economy has to do well.

It sounds like you won't have to buy into each investment they propose, but since they didn't raise that much money, I don't know how many choices you'll have. If you don't like their first investment, you can hold onto your REAL tokens instead of buying RPPs, but then you're not earning a return on your money, so it's just tied up.

Of course, if the Euro isn't your local currency, then you're you're taking that currency risk as well.

I know nobody asked the question, but I find this ICO fascinating and it's helping me become a better ICO investor as I think about what I'd REALLY be buying into.

Your analyses are always top notch. Maybe you should start an ICO analysis and rating service

[YGung]

@panorama, it's still not too long after ICO and it just hit exchanges, so regardless of the argument, I think many will just wait til the platform comes since that's supposed to be soon.  The platform won't really matter to me if you can't invest in anything when it releases though.

Whether it makes sense or not, on the right exchange this token could def pump above ICO price.  Common logic don't always apply in the crypto world, so people can def look for that.  It's just a matter of actually getting on a good exchange.

While I get the idea to hodl the ETH so that you can gain buying power, it's funny to me because if that's the idea, why not just hodl the eth as an investment if you're projecting only 10% gains in housing.  I mean, if you're in cryptocurrencies, I don't think many people would bet on real estate returns being bigger than eth investment returns over the next 5-10 years.  Not knocking their business idea/model; they've stated a while ago their plans of hodling eth, it's just ironic to me.  If you're going to hold the eth for 3 months, why not hodl it for 6 months? 18 months? 24 months ? 

[gikere]

New blog post today https://medium.com/@real_token/crypto-markets-and-real-progress-384f8943cef8

Just stating the obvious about converting ether to fiat at the highest possible short term price. Good to see they are posting something, atleast.

Yes, Something still better than nothing, I guess.

[panorama]

@panorama, it's still not too long after ICO and it just hit exchanges, so regardless of the argument, I think many will just wait til the platform comes since that's supposed to be soon.  The platform won't really matter to me if you can't invest in anything when it releases though.

Whether it makes sense or not, on the right exchange this token could def pump above ICO price.  Common logic don't always apply in the crypto world, so people can def look for that.  It's just a matter of actually getting on a good exchange.

While I get the idea to hodl the ETH so that you can gain buying power, it's funny to me because if that's the idea, why not just hodl the eth as an investment if you're projecting only 10% gains in housing.  I mean, if you're in cryptocurrencies, I don't think many people would bet on real estate returns being bigger than eth investment returns over the next 5-10 years.  Not knocking their business idea/model; they've stated a while ago their plans of hodling eth, it's just ironic to me.  If you're going to hold the eth for 3 months, why not hodl it for 6 months? 18 months? 24 months ? 

Yes, it's possible that the price could go above ICO values, but it relies 100% on finding buyers who don't know what they are doing and are just excited because something was released. There are plenty of people like that buying coins, but hoping to find uneducated buyers isn't a great investment strategy. Fundamentally, the price should never go back to ICO prices.

Regarding the decision to hold ETH longer, it's pretty ironic. Investors could have held ETH for themselves if they wanted appreciation without having to pay salaries for the team. So if they thought ETH was going to go up more than 12%-20%, they shouldn't be investing in the token.

As I mentioned in a previous post, at some point the team will have to convert to fiat in order to invest in real estate. So, by buying tokens, you're really buying into a fiat based investment and will lose out on any ETH appreciation (once they convert).

So either you want the ETH exposure and shouldn't invest, or you want the real estate exposure (based in fiat) because you think it'll outperform ETH. In that case, you should theoretically want them to convert to fiat because you wouldn't have bought tokens if you thought ETH was going to go up.

[panorama]

I've been thinking about the risk/return side a little more. By investing in REAL, you're buying into EU real estate (although we don't really know what country for sure). It also sounds like it'll likely be hotel investments. Let's put aside the possibility that they are actually just going to sell you a property they already own.

Holding on to tokens is therefore a hedge against crypto investments. Essentially you're saying you'd rather sell some of your cryptos, convert it to fiat (Euros) and buy real estate. You're betting that the 12% - 20% returns they are targeting is better than you can earn in cryptos on a risk-adjusted basis.

Assuming they will be buying hotel assets, it's likely a bet on the economy (although we don't know which one). Most hotels either target business travelers or tourists, but both depend on a strong economy. So, in order for your investment to do well, the dependant economy has to do well.

It sounds like you won't have to buy into each investment they propose, but since they didn't raise that much money, I don't know how many choices you'll have. If you don't like their first investment, you can hold onto your REAL tokens instead of buying RPPs, but then you're not earning a return on your money, so it's just tied up.

Of course, if the Euro isn't your local currency, then you're you're taking that currency risk as well.

I know nobody asked the question, but I find this ICO fascinating and it's helping me become a better ICO investor as I think about what I'd REALLY be buying into.

Your analyses are always top notch. Maybe you should start an ICO analysis and rating service

Thanks. I would if I could, but other people understand the tech much better than I do. I'm much better with understanding the business model, so I could only do it with a partner who understands blockchain tech better. 

[xCryptoManiaX]

New blog post today https://medium.com/@real_token/crypto-markets-and-real-progress-384f8943cef8

Wow. Well, that was useless. Does that mean they are still behind on developement or havent started at all?