One of the critical elements of an asset backed token is the join between the digital and physical world. The connection has to be trustworthy and transparent to enable the value of the token to follow the value of the underlying assets. Leaving aside that several tokens have proven to be not so strictly backed as announced. In order to assure this connection, Thrupny will have two key added specific programs dedicated to ensure transparency:
Robust Governance - the Thrupny RE Fund will have a clear and robust governance that we will publish on the blockchain for avoidance of doubt
Near Real Time Audit facility (NRTA) - Our transparency guarantee, based on the blockchain technology itself.
It is ironic that in the ecosystem of decentralised projects that some companies and crypto projects hide behind legacy processes to ensure they can manipulate their business model, Thrupny on the other hand, propose a completely transparent methodology as relates to the assets of the RE Fund. To do so we will use the transparent and permanent digital record properties of the blockchain to record our real estate transactions.
Uniquely, we will provide a permanently accessible Near Real Time Audit facility (NRTA). This will enable various levels of detailed access to the transaction details of the fund. The process will take a proof of stake style approach thus:
Investors into the Thrupny RE Fund will use the private keys of the wallets they used to invest to access their allowable level of data on the transactions
Public information will give prospective investors a high level view of the funds activities and the process by which they get access to more detailed information
In addition to the transparency offered by the blockchain, the NRTA will be completely automated and a secondary level of transparency will be guaranteed through an audit node that will be held by independent auditors, automatically paid by the fund so no potential for bias by the fund operating company can be possible.
The value of the token will be calculated as this equation demonstrates:
Value of 1 TREF in $ = ((total audited $ value of real estate assets) + (total audited $ value of equivalent cash reserves)) / (number of existing TREF)
The actual value will fluctuate slightly in the market because of the following areas, all of which we will work to reduce change and instability on through our technology:
- We need to account for the possible future appreciation or depreciation of the underlying real estate assets
- We need to account for variance between the estimated value of real estate assets and the real sale price when an asset is actually converted into $ (to compensate for which we will go for a slight overestimation of value of assets, which will be visible to investors)
- We need to discount the convertibility risk factor for the liquidity of assets
To ensure we have a stable and growing capital value of the token and that the revenue dividends distribute profits to token holders, we will be using several techniques to enhance the traditional REIT value calculation:
Open Valuation - this is another unique feature - The NTRA will give Near Real Time valuations and anytime visibility on the property transactions, giving any body the ability to value the fund - going forward this may be spun off as a Foundation to promote transparency
Increasing Efficiency Over time we will apply more and more efficiency to the management of our investment through the deployment of blockchain based automation technology for areas such as:
Price Management Through attention to detail on our integration to exchanges, tight management of assets, appropriate diversification, market making and revenues from sister tokens, Thrupny is focusing on ensuring a stable value for the token and profits for token holders.
Governance for Good we will not only be structuring and managing the fund for the good of investors but of the entire crypto ecosystem and to be an example of good governance in the space
We will have several type of auditors to keep us honest:
NRTA Big Four Auditor
One of the big four auditors has committed to accepting cryptocurrency for payment, in alignment with our mission to expand the ecosystem, we will be seeking a big four or equivalent auditor to hold a virtual node of our NRTA to carry out regular audits and issue reports.
NRTA Investor Audit
Each ICO investor will have access to the NRTA for varying levels of information. We will also offer that any investor taking up Thrupny post ICO, from exchanges or further offerings, will be granted access in a seamless way.
NRTA Crowd Audit
As the NRTA will be based on transactions published to the Ethereum blockchain, the public will have access to the top level of information we permit, this will help prospective investors in Thrupny to make decisions about level and timing of investment.