Fractional Ownership: What Assets Can I Own?
Fractional ownership is not a new method of investing. There are numerous assets which can be fractionalised in order to provide a fairer and cheaper investing experience. In this article, we’ll cover the various assets and platforms that allow you to fractionalise. But first, let’s cover some basics.
What Is Fractional Ownership?
Fractional ownership is when an asset’s ownership is divided into multiple fragments, it is then bought by a group of several investors which can then benefit from usage rights, asset appreciation and overall profit on the sale of the asset fraction.
You can fractionalise pretty much any asset, this ranges from precious metals, sneakers, luxury yachts and even real estate.
Many people confuse timeshares as a method of fractional ownership when in fact a timeshare is the ownership of a selected time rather than equity in the home.
Fractional ownership has been around for a few years and is considered to be an innovative investing method.
But, technology has advanced significantly the past few years and with the introduction of blockchain technology, fractional ownership has been given a new lease of life.
Tokenized ownership is now the method of choice as it is more transparent, cheaper and decentralised. This form of tokenized ownership is booming within the NFT space as what we know as F-NFTs or fractional NFTs. So what is a Fractional NFT?
What Is A Fractional NFT?
Similar to the traditional principle, a fractional NFT is simply an asset that is split into multiple tokens that can be bought or sold.
These NFTs can be split into thousands of different fractions whereas traditional asset fractionalising is typically up to 100 owners.
It’s fractionalised using a smart contract that will generate a predetermined number of tokens that are linked to the indivisible original.
What Assets Can You Fractionalise?
Nowadays you can fractionalise pretty much anything that you want thanks to Blockchain technology and tokenization. This ranges from sports cars, yachts, planes, gold, diamonds, memes, NFTs and most popular is real estate.
There are a few platforms that you can do this on, we’ll list them below:
A top player within the NFT marketplaces and fractional NFT space; fractional art is decentralised and permissionless. It hosts some of the most famous collections such as CryptoPunks, BAYC and MAYC.
The most up and coming NFT marketplace, The Piece promises to level the playing field when it comes to NFT ownership. Their goal is to make NFT investing cheaper, easier and faster than ever before.
Currently working on their marketplace, The Piece aims to offer fractional ownership for many other assets and not just fractional art, the goal is to offer fractional real estate and much more.
Otis allows fractional investing on a wide variety of NFTs. However, they also allow investors to own fractions of physical collectibles such as rare sports cards, books and premium sneakers. They host pop up events so investors can go see their investments in real-life.