Our Fintech Research Center is currently focused on a broad range of projects and initiatives, including:

Real Estate Finance Innovation

Real estate is well-known to be one of the least-fungible asset classes (that is, assets are not standardized and exchangible), one that only a small percentage of the population is able to participate in due to its notorious difficulty to trade or exchange. By financializing the real estate market, blockchain technology can allow the creation of completely new markets and exchanges for tokenized real estate asset-back securities that can provide huge liquidity to create an efficient market for a previously un-fungible asset. By fractionalizing real estate ownership, one can financialize the entire industry, providing a great deal of wealth creation from the liquidity as well as being able to apply the rich business models and techniques from the capital markets over the decades to make the real estate market more resilient, sustainable, and stable. Examples include: 1) providing real estate and mortgage financing innovations, 2) sophisticated portfolio management techniques to diversify risk. 3) index funds with synthetic rebalancing techniques to enable less sophisticated investors to participate 4) innovative new forms of cryptobond instruments to spur infrastructure development, etc.

Special Economic Zone Blockchain Infrastructure Development

With more than US$41.7 billion worth of global capital investment in 2018 alone, Fintech innovation is well on his way to disrupt the global financial industry. However, due to regulatory challenges and the lack of interoperability standards, the industry is still highly fragmented and regionally siloed. Special economic and free trade zones together with blockchain technology innovation are vital components to catalyze the emergence of global Fintech innovation. We propose the development of a new digital regulatory framework in the Hainan Province of China, which has recently been designated as a free trade zone as the mainland port terminus of the Belt and Road. Hainan is uniquely positioned to serve as the strategic testbed for policy and technology. Indeed, the city of Sanya in the Hainan region is strategically placed to serve as the gateway legislation to bridge the east and west open core banking infrastructure and to attract cross-border financial institutions to foster the creation of the next generations financial products and services.

Analyzing Token Economics

Initial Coin Offerings (ICOs) and Secutized Token Offerings (STOs0 represent an advanced version of crowdfunding through sites like Kickstarter, or virtual currencies/items on games like World of Warcraft. They came with promises of returns and creating markets for the tokens to be actively traded. The SEC has tried to balance concerns of facilitating capital formation and market liquidity with its goal of protecting retail investors. When looking at security tokens and securities trading infrastructure, blockchain makes certain categorizations of traditional players in the securities space tricky. The US has broker-dealer registration requirements for those playing certain roles in securities offerings (where many of the media players in the space currently may fall), and there are also requirements for transfer agents and clearance and settlement agencies.

Crypto-Assets Regulation and Overregulation

Crypto-assets-based networks hold the potential to create value on an order of magnitude far bigger to that of the Internet. Government regulations can have both positive and negative effects on the innovation process, as unfriendly ICO and STO countries stand to lose intellectual capital to foreign jurisdictions with a more proactive approach. Well-developed domestic standards for crypto-assets corporate finance transactions could provide the certainty that keeps innovators at home and attracts talent from all over the world, effectively promoting a country’s entrepreneurship spirit and innovation.

Using Blockchain to Financialize the Real Estate Market

Real estate is well-known to be one of the least-fungible asset classes (that is, assets are not standardized and exchangible), one that only a small percentage of the population is able to participate in due to its notorious difficulty to trade or exchange. By financializing the real estate market, blockchain technology can allow the creation of completely new markets and exchanges for tokenised real estate asset-back securities that can provide huge liquidity to create an efficient market for a previously unfungible asset. By fractionalizing real estate ownership, one can financialize the entire industry, providing a great deal of wealth creation from the liquidity as well as being able to apply the rich business models and techniques from the capital markets over the decades to make the real estate market more resilient, sustainable, and stable. Examples include: 1) providing real estate and mortgage financing innovations, 2) sophisticated portfolio management techniques to diversify risk. 3) index funds with synthetic rebalancing techniques to enable less sophisticated investors to participate 4) innovative new forms of cryptobond instruments to spur infrastructure development, etc.

Transforming Global Infrastructure Through Technology and Blockchains

Infrastructure solutions backed by new emerging technology applications can drive (i) innovative and practical solutions for previously intractable problem of inefficient infrastructure provision; and (ii) innovations in infrastructure financing to help close the massive infrastructure funding gap. Blockchains, Smart Contracts, Distributed Ledgers, and other tools of the emerging blockchain-based economy are providing new methods of financing infrastructure which reduce cost and time, and importantly, improve transparency and limit the role of governments in financing of infrastructure.

Chinese Leadership in the Development of Infra-Tech Industry

China is well positioned to lead the modernization of global infrastructure by incorporating technology in its domestic and overseas infrastructure programs. The One Belt One Road Initiative can bring about the most important structure change in the world with far reaching positive consequences, particularly in the the developing countries. This will require China to take a leading role in the development of the fast-emerging global infra-tech industry, supporting technology mediated infrastructure solutions. Infra-tech solutions can help deliver financial sustainability as well as environmental and social impact.