Revenue Participation model
for Investing with Blockchain
Tokenization is a promising new method for creating investment opportunities, particularly for smaller projects that are typically priced out of common investment vehicles like stocks.
The problem: Tokenizing the ownership of an asset currently lacks the proper legal framework necessary in most jurisdictions. Additionally, owning a fraction of an asset comes with certain obstacles to the rights and obligations of the token holder.
The solution: Offer investments only into a company’s (or asset’s) revenue, instead of selling parts of the company itself. In the investment sector, this type of investment is known as a profit participation certificate. In legal terms, this model is known as “usufruct.”
With the tools provided by CoreLedger, this solution can be applied to any business case where revenue is created over time. Companies issue a “Participation Token” which grants the holder the right to a percentage of future profit. That profit is then paid out to the investor via a “Payout Token.” Both of these tokens can be sold on exchanges. Let’s take a look at this solution in more detail.
3. DISTRIBUTE THE PROFIT VIA PAYOUT TOKENS
- Distribute the revenue/profit directly to the investor's wallet App.
- Add functionality to your payout tokens, e.g. use them as payment for additional services.
4. REDEEM OR SELL THE PAYOUT
- Investors can exchange or redeem their tokens.
- Tokens are sent back to the issuer, and can be burned or re-used.
- The payout in fiat currency is done via bank transfer, Bitcoin, or your method of choice.
Tokenize the profits from commercial buildings, supermarkets, appartments, or anything else that can be rented out.
Farms, Orchards, and Ranches, are ideal use-cases for Revenue Participation thanks to their consistency and community value.
Industries that continuously produce things of value for a community are ideal for this investment model. Factories, power plants, windmills, and mines can all easily make use of Revenue Participation.