Pavel Jakovlev on Trends in Blockchain and Real Estate
The 4th CV Summit and the CV Competition in March revolve around #BUIDL — to build towards crypto spring and to develop blockchain solutions for the real estate industry. An interview with Pavel Jakovlev, CV VC Blockchain Incubation & Ecosystem Lead and leader of various departments at CV Labs:
Pavel, why lies the focus of the next summit and competition on real estate?
We wanted to challenge the global blockchain community by selecting real estate for this edition of the CV Competition: It’s an easy to understand industry, ripe for digitization and innovation, therefore we decided to push things a little further and have expanded the focus to construction and logistics, land registry, smart buildings and IoT, as well as real estate investment and asset management. The CV Competition finals will take place during the CV Summit’s main day.
What can blockchain do for real estate that current technologies can’t do?
We have come across super interesting use cases of blockchain, though I must say that some seek to solve real life problems for the industry, others make push you to rethink our approach to (smart) buildings.
Fractional ownership, real estate tokenization, smart contracts and escrow services make up the most common blockchain applications.
We also came across interesting solutions for the construction industry, where blockchain can solve tracking and authenticity of materials before, during and after the construction process.
For architects, blockchain can become invaluable as more and more Building Information Modelling (BIM) applications are becoming an industry standard.
For facility managers, blockchain offers incredibly lucrative issues-reporting applications and, one of the most interesting startups I came across — a tokenized ecosystem of cleaning robots.
How will the blockchain technology impact real estate?
Real Estate industry is broad, highly specialized and fragmented. There are different value chains where transformation may happen: from investment syndication all the way to market places, building material quality tracking, property management and facility management. Plenty of great startups are solving process inefficiencies and enabling new business models using blockchain technology. I am actually quite thrilled to see which blockchain solutions will get the most traction in the nearest future.
What do you think will be the first real estate blockchain applications that we will see or even use ourselves?
I believe we are already here. Blockimmo — a Swiss blockchain startup, CV Labs tenant and one of our community’s best and brightest has built a fractional ownership platform on the Ethereum network. Just recently they have tokenized their first real estate project, which is now available on their website. Everyone, who currently holds Ether can buy a small fraction of a building in the neighboring Cham — and that’s super exciting!
Are there any concrete projects or ideas you find very promising?
I like simple and clean solutions for very obvious problems, therefore everything that has to do with fractional ownership appeals to me. Blockchain allows people to invest small amounts in real assets and enables them to trade said assets on a secondary market.
In terms of ideas, here I switch gears into futurism and dream that one day blockchain will enable us to become more collaborative, transparent and trust one another on a grander scale. We have a couple of startups that are pushing the boundaries on how we approach public spaces and our overall value system.
How will the tokenization of real estate assets reshape the future of property investing?
Though it would be awesome to know that now, so we, as a VC could place the strategic bets with a high level of confidence, the future remains uncertain. Yes, tokens are set to democratize and increase liquidity of the otherwise a traditional, illiquid asset class. I believe that regulation will be the deciding factor and will set the pace for tokenization of the real estate assets.
What are the risks that come with the tokenization of real estate assets or blockchain solutions for the industry?
Investor protection is paramount to success in this process. We are fortunate enough to have highly professional and responsive regulators who are open to innovation. Both Switzerland and Lichtenstein implemented favorable, yet firm regulations on digital securities (coins, tokens) with the highest level of investor’s protection and robust dispute settlement procedures.
Is Switzerland’s real estate industry prepared and ready for the transformation?
The Swiss PropTech scene is growing rapidly. Transformation is a lengthy process that requires input from various stakeholders. Change is always exciting and a bit scary.
In the past couple of years there has been several interesting developments in the real estate sector: a Swiss-based startup developed a space and material optimization process that would reduce time to market and building costs and another Swiss startup is driving efficiencies in the real estate development process through the use of artificial intelligence. We also see interesting developments in the areas of IoT and blockchain.
I am confident that Swiss real estate’s industry players are open to new technologies — otherwise we wouldn’t have strong partners, like Wincasa, SBB, Credit Suisse, Alfred Muller and Pom+ supporting us during the CV Competition for Real Estate.
How do the CV Summit and the CV Competition contribute to the Swiss real estate industry?
The CV Competition is an international startup event with a sole purpose to showcase the best ideas and solutions to the real estate industry. The competition’s contribution is the actual research and engagement efforts that activate startups, motivating them to come over to Switzerland and compete.
CV Summit is a networking and a thought-leadership platform. We believe that by combining the CV Competition real estate topic(s) with CV Summit overall ‘BUIDL’ theme we will see exciting startup use cases and participate in insightful conversations, aimed at bringing all of us one step closer to blockchain’s mass adoption.