Regulator of Germany approved the sale of tokenized bonds for $ 280 million

Fundament Blockchain-start-up received permission to issue the first tokenized secured real estate bond that can be offered to retail investors.

Berlin firm received
approval from the financial regulator of Germany BaFIN to offer tokenized bonds for 250 million euros. Thanks to the regulator’s approval, the token will be available to any retail investor anywhere without minimal investment restrictions. BaFin noted:

“We can confirm that we approved the Fundament Group prospect. Indeed, we approved the prospectus for bonds based on the blockchain for the first time, but not for the first time regarding the technology of the blockchain itself. ”

The token, which Fundament will begin selling next month, will be released on the Ethereum blockchain using the ERC-20 standard. The co-founder of the Fundament Group, Florian Glatz, said:

“The reason why we went through this long and tedious process with the regulatory authorities was the removal of any restrictions. Typically, such projects are limited to either a minimum investment of 100,000 euros, or the number of investors. So this is the first truly massive sale of tokenized real estate backed bonds in the world. ”

The Fundament Token will be supported by five separate building projects: three in Hamburg, one in Frankfurt and one in Jena. The portfolio will include residential, commercial and hotel facilities. The company predicts a high and average return on investment of 4-8%.

To comply with the rules of KYC and AML, IDnow will be responsible for verifying the identity of potential buyers of tokens. According to Glatz, the process takes an average of three minutes before the user can purchase tokens. Fundament will not use an investment bank, but will distribute securities itself to lower issuance costs and increase profits for investors, said Fundament’s second co-founder.

Buyers can pay for their tokens in bitcoin, broadcast, US dollars or euros. For those who pay in fiat currency, Fundament will put tokens on a hardware device.

“We submitted a prospectus in December 2018 and received approval last week. So we spent 6 or 7 months to get approval, ”said Matzke. “Every two or three weeks the regulator sends you about 20 pages of text for revision, and so on for several months. As a result, the prospectus turns into a book, our size has reached about 100 pages. ”

Recently, the US Securities and Exchange Commission (SEC) approved
$ 28 million public offering of Blockstack startup tokens.