Liquidity

Real estate-backed tokens often suffer from a lack of liquidity. These tokens are often regulation D tokens where each home has its own tokens and tokens are traded via market book order or AMM's. The combination of all of these factors makes the tokens illiquid and less suitable for integration with defi. Regulation D tokens also are only available to accredited investors.

Gypsy takes a different approach to token liquidity with goals to have high liquidity, no lockup periods, and accurate token pricing to make a powerful tool for defi and yield farming.

Singular token to back all properties

There are several reasons why having a real estate-backed cryptocurrency token that is backed by an entire portfolio of homes may be more liquid than having each home having its own token.

Risk diversification

A single token that is backed by a portfolio of homes helps diversify risk. If each home had its own token, the value of the token could be 100% dependent on the specific characteristics and performance of that individual home. In contrast, a portfolio of homes is likely to have a more diverse set of characteristics and may be less vulnerable to changes in the market or other factors that could affect the value of a single home. This can make the GPSY token more stable and potentially more attractive to investors.

Easier to invest

A single token may be more convenient for investors. Instead of having to track and manage multiple tokens for different homes, investors can simply hold and trade a single token that represents a diverse portfolio of homes. This can make it easier for investors to buy and sell the token, which can increase liquidity.

Concentrated Trading Volume

A real estate-backed cryptocurrency token that is backed by an entire portfolio of homes can enable all trading volume to be concentrated in a single token, which can increase the volume traded and help with price discovery & token liquidity.

When there is a large volume of trading activity for a particular asset, it can provide a better indication of the market's sentiment and help to determine the fair market value of the asset. This can be especially important in the real estate market, where prices can vary significantly based on factors such as location, property type, and market conditions. By having a single token that represents a diverse portfolio of homes, it can facilitate a higher volume of trading activity and provide a clearer indication of the market's valuation of the underlying assets.