While still relatively small, the global real estate token market continues to record substantial gains. Its value increased by around 4.27% during April 2020, meanwhile, the largest securities tokens experienced losses for the same time period.
The total market cap of security tokens dropped 8% overall during April. According to a report from the Security Token Group, the securities tokens market recorded one of its worst performances last month.
The total trading activity for security tokens fell 38% during April.
However, the real estate token markets for single-family homes located on Patton St, Lesure St, and a property on Appoline St in Detroit experienced significant increases in volume during April.
Trading of property tokens for the homes on Appoline St increased nearly 2x to record almost $25,800 in trade volume, while posting a price increase of 1.37%. Trading of tokens for the houses on Patton’s St increased about 50% to $10,600, while recording a 1.81% price appreciation. Lesure St’s overall volume surged 38% to $6,042, while experiencing a price increase of 1.75%.
Although overall trading activity dropped, the tokens for properties located on Fullerton Ave, Auboden St, and Marlowe St recorded price increases of 8.74%, 7.19%, and 4.78% respectively.
Real estate tokens have been (on average) paying double-digit interest on an annual basis. Per the report, “the [average] return for investors is closer to 6% in just the month of April” across the property sector.
The losses recorded across the security token market may largely be attributed to a 16.5% decline in the price of tZERO, which notably accounts for 43% of the overall real estate sector market cap.
Trading activity for tZERO dropped by over 50%, with about $125,500 in total trading volume.
The property sector’s subpar performance has come right before the distribution of Overstock’s dividends to investors on May 19, 2020. Shareholders receive one OSTKO security token for every ten company shares (in Overstock) they hold.
Overstock noted in its recent Q1 2020 earnings call (held on May 7, 2020) that it was planning to list regular stocks on tZERO, the company’s digital security token exchange.
The firm claims that tZERO’s customer base increased by 40% during the past quarter, with 6,404 new user accounts becoming active on the trading platform, as of last month.