Decentralized title registry firm Propy Inc. has raised $15 million from 6,597 participants in a PRO token sale to put the international real estate market on the blockchain.
Propy is a startup that's working with the government of Ukraine to allow online real estate purchases by foreign investors. The company uses the blockchain technology that underpins Bitcoin and other cryptocurrencies as a ledger to record all real estate deals involving foreigners.
Prior to the start of its public sale, Propy had already secured $2 million in pre-sale commitments.
“By recording real estate transactions in the blockchain, Propy brings the transparency and accountability buyers and sellers of real estate need,” said Scott D. Hughes, one of the pre-sale participants n Propy, a well-known lawyer from Orange County and a real estate investor.
“It was an easy decision to invest,” said Debbie Chiu, another pre-sale participant in Propy. “Prospective homeowners and sellers need a simple, secure way to transact without middlemen, and Propy’s solution offers that.”
The momentum continued into the public sale with a large investment pouring in the first hour from RenGen, an investment company, and Crunch Fund, an early stage investment firm based in San Francisco.
Propy also announced a significant new hire to its executive team. The company said its hiring Vasilious Vutsadaskis Ph.D., an MIT graduate, scientist, and patent author with experience in computational physics, programming, and legislative research. Vasilios has experience in dealing with real estate transactions in both the EU and Russia.
To emphasize its commitment to managing global real estate transaction, Propy also locked in two key international partnerships. First, the company has partnered with Leju Holdings Limited, the leading online-to-offline real estate services provider in China to facilitate online real estate purchases by foreign investors.
Second, as mentioned above, Propy partnered with the government of Ukraine to allow online purchases of Ukrainian real estate by foreign investors. This is the first time the Ukrainian government has permitted a company to manage online transactions between foreign buyers and sellers of Ukrainian real estate. As of January 1, 2018, new legislation will allow foreign investors to purchase land in the Ukraine, opening up the nation’s rich agricultural resources to international buyers. Adhering to these new laws, the first real estate transaction is underway by Michael Arrington, the founder of TechCrunch. Pilot programs will be led by Propy in coordination with Ukraine’s Agency for E-Governance throughout the next year.
Real estate illiquidity and centralization acts as a significant deterrence obstacles for investors seeking to purchase properties abroad. Currently, there are no international standards or single, comprehensive platform to track and manage electronic property rights transfers. Legacy registry systems were created to handle local homebuyers, but are ill-equipped to manage international ownership transfer. To solve these problems, the Propy Registry is powered by smart contracts to track and execute real-estate transactions according to regional regulations. By using the Ethereum smart contracts, Propy allows brokers, buyers, sellers, and title agents/notaries to sign off on transactions using private keys within their existing legal frameworks.