# Welcome! Homebase's mission is to democratize access to real estate investing, and empower the next generation of homeowners. The resources we've listed here are to help new and existing users become familiar with the Homebase platform. {% content-ref url="/pages/ROmzxkcqXA7h4CBJ80Dp" %} [Whitepaper](/whitepaper/introduction) {% endcontent-ref %} {% content-ref url="/pages/3BaSRNLnWZJngmQ7yIAW" %} [Creating an Account](/creating-an-account/account-creation) {% endcontent-ref %} # Introduction America was predicated on the idea of equal opportunity for all of its citizens. It was built on the dream that if you worked hard, you’d be able to build a good life for yourself and your family. Core to this dream was the pursuit of homeownership, a place where your family could take refuge, grow into, and pass down to future generations. A home was something to be proud of and a tangible way to cement one’s legacy, and most people could cement their legacy by working hard until they had enough money to buy such a home. Things are different now. It’s harder to become a homeowner today than it’s been in any other point in history. In short, the American dream is *dying*.
Owning and investing in real estate has historically been a great way to build consistent wealth over time. If you take any 10 year view of US real estate, you’ll see that the average home has appreciated at least 30% and delivered consistent monthly cash flow through rents. Unfortunately, for the last 10 years, home prices have been on a tear and the average person’s salary has failed to keep up. The median home price to income ratio for Americans is now at 7.78x – the highest it’s ever been. It would take the average person 8 years to be able to afford a home assuming they keep 100% of their gross salary. 20 years ago this ratio was 4.2x and, even during the 2008 housing crash, this number was just above 7x. In short, housing has become unaffordable. With mortgage rates now climbing well over 6%, and real estate prices at sky high levels, the situation is dire. The average person wants to invest in real estate, but doesn’t have the means to access proper financing through bank leverage (mortgages) or cash. # Why We're Here The team at Homebase understands that real estate is a great way for people to build wealth, which is why our mission is to democratize access to real estate investing and empower the next generation of homeowners. We plan on doing that by tackling three problems facing the industry today: * Housing Affordability * Friction in Transactions * Opacity of Housing Data ### Housing Affordability Real estate has historically been a great asset class to invest in as it steadily appreciates over time and provides monthly cash flow through rents. A 2018 analysis by Laurie Goodman and Christopher Meyer calculated the relative financial returns of buying a house compared to renting in 2002. They found that, over the last 20 years, home ownership has been a better performing asset than bonds, the S\&P500 and even investing in a public apartment ownership REIT, or real estate investment trust. In tandem, housing affordability is the lowest it’s ever been, and is only projected to get worse. As interest rates climb, the buying power of individuals drops which in turn shrinks the pool of new prospective homebuyers. This leads would-be homebuyers to become renters instead, barring them from benefits of homeownership. This divide is even more drastic in urban cities where 60%+ of the population rents. In fact, according to a [survey by the New York Times](https://www.nytimes.com/2022/11/11/realestate/first-time-buyers-housing-market.html), the percentage of first time homebuyers is now 26%, down from the historic average of 40%, and the lowest it has been since the survey began in 1981. With no equity in the homes that they live in, renters are trapped in a perpetual cycle of increasing rent payments and zero equity ownership. In 2022, rents increased [4x faster than income](https://www.realestatewitch.com/rent-to-income-ratio-2022/). ### Friction in Transactions The process of buying and selling real estate today is full of friction. Transactions can take months to close, still often require signing physical paperwork that needs to be mailed or faxed, require working with multiple third parties and can cost you tens of thousands of dollars in fees. On top of that, in the age of the internet, many counties across the United States still require you to sign and transfer the deed of a home in-person and register it with the local county’s office. This makes the entire process inefficient and ultimately ends up costing the end consumer more. For example, bank inefficiencies in how they securitize mortgages leads to an additional 100 basis points in the cost of your loan. This might seem small, but even a 0.50% interest rate reduction on a $500,000 mortgage saves $2,500 per year of post-tax salary. ### Opacity of Housing Data In our current system, housing data is fragmented and siloed. Third-party institutions create walled gardens around their own proprietary data and force prospective home buyers to pay for access to that data. These companies have a vested interest in keeping the status quo of obfuscated real estate data. This includes your local title companies, real estate data brokers, and banks. Often, only large institutional investors have the means to pay for this data access. This results in institutional investors having much broader and accurate data vs. your local investor, and leads to them making better informed investment decisions. # Our Vision The vision for Homebase is to become the preferred platform for renters moving to a new city. Imagine you’re moving to San Francisco, instead of using Craigslist to find an apartment, you go directly to the Homebase platform to browse apartments available for rent. If you find one you like, you move in and purchase 10-20% of available shares of the home. By buying an equity stake in the property, you’re now a partial owner of the apartment you’re living in. That’s the future we’re building at Homebase. Our goal is to bridge the gap between the casual Zillow-scroller and the real estate investor. We’re building a platform built on trust, transparency, and co-ownership so that anyone can invest in real estate. By building accessibility to ownership for all, we can redefine what it means to be a homeowner. The status quo bars everyday people from becoming an owner. If Homebase succeeds in its mission, renters in the most densely populated metros in the U.S. can become fractional owners of their apartments and, in turn, homeowners. # What We Do Homebase makes it incredibly easy for people to invest in tokenized residential real estate. Through our platform, users can invest in rent-generating residential real estate for as little as $100 and gain the upside of investing in high quality real estate assets. We’ll challenge the current status quo in real estate investing by leveraging disruptive technology, making all data open and transparent and capitalizing on community leverage. We will be tokenizing real estate properties via [security token offerings (STOs)](/whitepaper/security-token-offerings), a legally-compliant way to tie real world assets to on-chain tokens, and offering them on our platform so that anyone can become a real estate investor. The resulting property tokens will become a bridge between liquidity in decentralized finance (DeFi) and returns on assets in traditional finance. The idea of fractionalization of real estate is certainly not a new one. For many, fractionalization has been in the form of shared interest in business partnerships or joint ventures to purchase properties. For others, fractionalization has been co-investments with friends. These sort of agreements rely heavily on trust and relationships (either business or personal) that are built up over time. No matter what, participation in these co-investments require at least one part of the team to take a leap of faith or pay a premium for trust. What if we could make this sort of ownership truly trustless? ### Trustless Technology The driving thesis of blockchain centers around the need for peer-to-peer systems for the verification of information and transactions in a trustless manner. When paired with a largely immutable asset such as real estate, there is an opportunity to make ownership trustless and allow platforms, such as Homebase, to remove the historical cost premiums placed on trust. Removing these premiums ultimately reduces the barrier to entry. Additionally, using blockchain technology allows us to tap into a largely evolving ecosystem with existing payment rails to reduce transfer costs, tap into built-in liquidity, and build in safeguards for users directly into our ownership tokens. The end result is an opportunity for anyone to invest in real estate, no matter their pre-existing relationships or budget. ### Data Transparency By using blockchain technology, Homebase users and investors will also have access to transparent sources of data to all homes tokenized on the platform to showcase things like month-to-month price changes, transaction history, and legal documentation. Our aim is to bring information parity between institutions and retail investors. Ultimately if local investors have the same information as institutions, they can make better informed investment decisions. ### Community Leverage As mentioned earlier, real estate is quickly becoming unaffordable throughout the country. In our quest to democratize access to real estate investing, all home offerings on our platform will be funded via equity in a community raise. By providing the tools for individuals to pool their capital together in order to invest in real estate, we can capture the power of what we call community leverage. By definition, leverage is the use of debt (borrowed funds) to amplify returns from an investment. Traditionally people rely on banks to take on leverage for investment, but need to qualify for certain loans by either having enough collateral, a good enough credit score, or high net worth. Not everyone has the means to do that. Community leverage is the idea that communities of people who invest together are able to achieve the same purchasing power as institutions. This will allow anyone to invest at these same leverage to value multiples without needing a bank. In the future, we will partner with loan providers to give users the option to stake their ownership share in a property in exchange for debt. In this way, we let individuals decide whether they want to take on leverage on their investment, one of the core tenets of real estate investing. # Value Proposition Real estate is one of the biggest markets in the world by market cap. In just the U.S. alone, the total value of homes sold as investments in 2021 was $435B. If expanded to include all residential real estate in the US, the value balloons to $2.9T. While most Americans know the benefits of investing in real estate, many are barred from ownership due to home prices being too expensive, not knowing how to get started or the high activation energy required to work with multiple 3rd parties over a 2-3 month period. By tokenizing rent-generating residential real estate, retail investors can invest in individual properties, gain a source of passive income and benefit from appreciating asset prices at an affordable entry price. ### **Ease of Use** Homebase aims to curate a seamless user experience for people who want to invest and own real estate. Investors on our platform don’t need to worry about anything. Homebase will source and list suitable investment properties on the platform, setup and deal with all property management, and collect and distribute rent to all owners each month. To invest in real estate via traditional methods, investors need a sizable amount of capital (median US home price is $430k), to work with multiple 3rd parties (appraisers, banks, etc) and have to deal with the headaches of property management. By transacting on Homebase, investors don’t need to worry about any of the pain points associated with traditional real estate investing. We’re making real estate investing a truly passive experience. ### **Proof of Ownership** Instead of having to go to your local county office to see who owns the title of a property, blockchain enables trustless verification of ownership. Utilizing smart contract transactions on a blockchain, investors will get paid their proportional amount of rent whenever Homebase gets paid by the tenant (each month). Smart contracts are digital programs stored on a blockchain that are automatically executed when predetermined conditions are met. For example, when executing a smart contract to buy an avatar on Opensea, the user initiates interaction with a smart contract, approves the transaction via a digital signature, and, if enough currency is present to proceed with the transaction, the avatar (or token) is sent in exchange. Having ownership in a real estate asset represented via token also means that it can be stored in your personal Solana wallet, giving more ownership to users. Over time, we will partner with third-party lenders to allow token holders to stake their property NFTs for additional leverage if they choose to do so. ### **Compliance and Legal Protections** Homebase proudly receives counsel from Hunton Andrews Kurth, a Top 100 U.S. Law Firm [per the Vault Law 100 Rankings](https://legacy.vault.com/best-companies-to-work-for/law/top-100-law-firms-rankings), on our approach to tokenization of real estate. We’ve gone through lengthy measures to ensure that our tokens are best-in-class in legal compliance so that end users are protected from any regulatory changes down the line. Per the U.S. Securities and Exchange Commission’s (SEC) Howey Test, as long as we are providing an instrument with return, we are issuing a "security", and need to comply with local regulations regarding security offerings. Given that we are offering on-chain tokens, that will mean we fall under the "security token" offering umbrella. As of now, security token offerings (STO) are one of the few legal processes to bring interest-bearing real world assets on-chain in the US. In the section Legal Compliance, we will discuss how the Homebase process of tokenization works and the regulation exemptions that we follow. # How It Works

The Process of Tokenizing a Property

After a detailed sourcing, selection, and due diligence process, Homebase puts the residential property under contract and sets up an SPV (Special Purpose Vehicle) to hold the asset. Using that SPV, Homebase issues a private (e.g. Reg D) or public (i.e. Reg A+) fund via the so-called STO (Security Token Offering) process. After the filing (and/or approval) with the SEC (the U.S. Security and Exchange Commission), Homebase issues non-fungible security tokens using the Metaplex NFT standard, and ensures that certain guardrails and functions are available to these tokens to enforce the laws governing these securities. # Security Token Offerings A Security Token Offering (STO, i.e. tokenized IPO) is a type of public offering in which tokenized digital securities, known as security tokens, are sold in security token exchanges. Tokens can be used to trade real financial assets such as equities and fixed income, and use a blockchain virtual ledger system to store and validate token transactions. Much like traditional securities, security tokens are subject to regulation and need to conform to strict compliance standards. By leveraging blockchain technology, security tokens allow for many traditionally cumbersome and highly manual processes to be automated, and provide a single source of truth that all parties can depend on. # Non-Fungible Tokens (NFTs) Homebase security tokens are also non-fungible tokens, or NFTs. That means that there will be a finite number of tokens issued per home, which will stay constant and represent fractional ownership of the property. Each token represents partial ownership of a property by an individual, is unique, carries detailed information about the property, and, in the future, can be staked as collateral to take on loans with 3rd party loan providers. The Security Token Offering is constructed using [Metaplex's NFT standard](https://docs.metaplex.com/) for Solana. A [Metaplex Candy Machine](https://docs.metaplex.com/programs/candy-machine/overview) is configured alongside several [Candy Guards](https://docs.metaplex.com/programs/candy-machine/candy-guards) (rules for the offering/mint). The following Guards are used to comply with securities regulation: * **Allow List:** a whitelist that will comprise of addresses belonging to eligible users. Eligible users are determined by the security offering taking place. For example, in a Reg. D offering, all KYCd, American accredited investors will be added to the allow list. No one outside of the allow list can partake in the offering. * **Mint Limit:** a limit on the number of NFTs (shares of a home) that an eligible user can purchase * **Token Freezing:** tokens can be frozen and thawed by the freeze authority (Homebase). This is important when conducting STOs via Reg. D offering as tokens cannot be transferred for 1 year following mint. * **Token Burn:** tokens can be "burned" by Homebase. This is done by nullifying the status of the token in the token's metadata. This will be used in the event that a user's account is compromised or cryptographic keys are lost. The stolen/lost tokens can be "burned" (nullified) and replacement tokens can be issued to the user's new wallet. ### **Home Metadata** Following [Metaplex's Token Standard](https://docs.metaplex.com/programs/token-metadata/token-standard), every token has its own metadata URI. That URI links the token to an off-chain JSON resource containing the token's metadata. Home data is encoded into the metadata of its respective token. The decision to store metadata off-chain as opposed to on-chain was made for the following reasons: * Cost efficiency: The cost to store data on-chain is significantly higher than off-chain storage. * Updating: In the event that home data changes (i.e. a new bedroom is added to the home), it is a trivial task to have the off-chain metadata file updated. This change would be reflected in all associated tokens. Long-term, we plan on migrating the majority of home metadata on-chain as storage costs come down. ### **Ownership Rights** The tokens themselves represent fractional ownership in the SPV holding the property. That means, if person A trades their home tokens to person B, ownership rights automatically get transferred between both parties at the time of the trade as long as person B is also KYC’d on the Homebase platform. This dramatically cuts down the time and friction required to buy and sell ownership stakes in real estate as opposed to selling through traditional channels. ### **Photo of the Property** Every home that is fractionalized via NFTs on our platform will have corresponding artwork that represents the property. This is by design. Homeownership is very personal for people, and ownership tokens should be too. The pride that a homeowner feels from showcasing their home to their friends is something that we want to recreate for investors with our home NFTs. The NFTs will be a visual representation of the property they represent, which owners can view directly in their wallet. In the future, we will create 3d maps that will highlight where each investment property is located within a city to further cement that feeling of pride. # Legal Compliance One of the key differentiators between Homebase and many of our competitors is legal compliance. Homebase tokenizes residential real estate in a completely legal fashion by following existing securities regulation in the US. Other companies tokenize real estate via NFTs, utility tokens, stablecoins, or a combination of the above, which do not legally represent ownership or undergo the same compliance process. If token holders expect to receive profits from the efforts of others (see [Howey Test](https://www.investopedia.com/terms/h/howey-test.asp)), it falls under the securities umbrella, and needs to comply with SEC regulation. To allow the issuance of tokens that are in nature securities, the SEC has published guidelines on "Security Token Issuance", which is exactly what Homebase will be following to conduct its business. At launch, Homebase will be issuing tokens under the Reg D exemption, i.e only available to US-based accredited investors. Over time, Homebase will issue tokens under Reg S, which will allow non-US investors to participate, and eventually switch to Reg A / Reg A+ which will allow any US investor to participate, non-accredited and accredited, in our offerings. ### **Rules Homebase Has to Follow** * Know Your Customer (KYC) check – mandatory process of identifying and verifying the client's identity when opening an account and periodically over time. We will be partnering with [Passbase](https://passbase.com/) to conduct KYC checks. * Only wallets that are whitelisted can own security tokens. Thus after a customer is KYC’d, their wallet will be whitelisted. * For Reg D offerings, we must take “reasonable steps” to verify that each purchaser is an accredited investor. Thus we will take steps to verify accreditation status in our account creation process. * For Reg D offerings, tokens will be frozen for the 1st year, meaning they cannot be sold or traded to comply with securities law. * The ability to burn tokens. This allows restoring tokens in the case an investor lost access to a private key. # Reg D Regulation D (Reg D) is a Securities and Exchange Commission (SEC) regulation governing private placement exemptions. Reg D offerings are advantageous to start out with because they can be obtained faster and cost much less to file vs. public offerings (Reg A). There are two types of Reg D offerings. 506(b) and 506(c) **Rule 506(b)** Under Rule 506(b), a “safe harbor” under Section 4(a)(2) of the Securities Act, a company can be assured it is within the Section 4(a)(2) exemption by satisfying certain requirements, including the following: * The company cannot use general solicitation or advertising to market the securities. * The company may sell its securities to an unlimited number of "accredited investors" and up to 35 other purchasers. * All non-accredited investors, either alone or with a purchaser representative, must be sophisticated—that is, they must have sufficient knowledge and experience in financial and business matters to make them capable of evaluating the merits and risks of the prospective investment. * Companies must decide what information to give to accredited investors, so long as it does not violate the antifraud prohibitions of the federal securities laws. This means that any information a company provides to investors must be free from false or misleading statements. Similarly, a company should not exclude any information if the omission makes what is provided to investors false or misleading. Companies must give non-accredited investors disclosure documents that are generally the same as those used in Regulation A or registered offerings, including financial statements, which in some cases may need to be certified or audited by an accountant. If a company provides information to accredited investors, it must make this information available to non-accredited investors as well. * The company must be available to answer questions by prospective purchasers. **Rule 506(c)** Under Rule 506(c), a company can broadly solicit and generally advertise the offering and still be deemed to be in compliance with the exemption’s requirements if: * The investors in the offering are all accredited investors; and * The company takes reasonable steps to verify that the investors are accredited investors, which could include reviewing documentation, such as W-2s, tax returns, bank and brokerage statements, credit reports and the like. * Purchasers of securities offered pursuant to Rule 506 receive "restricted securities, meaning that the securities cannot be sold for at least six months or a year without registering them. (Source: SEC official website) # Reg A Regulation A is an exemption from registration requirements—instituted by the Security Act of 1933—that applies to public offerings of securities. Companies utilizing the exemption are given distinct advantages over companies that must fully register. Companies relying on a Regulation A exemption can offer and sell their securities to the public under two different tiers that have two different requirements—Tier 1 and Tier 2. Under both tiers, the issuer must file an offering statement on Form 1-A with the SEC. The offering statement includes the offering circular, which is the primary disclosure document for investors. Investors must be provided with, or given information on how to access, the offering circular. An issuer can only accept payment for the sale of its securities once its offering statement is qualified by the staff at the SEC. The SEC’s qualification, however, does not mean that the SEC has approved of the securities offering. The SEC also does not assess the accuracy or completeness of any of the offering documents or solicitation materials. Under Tier 1, an issuer can raise up to $20 million in any 12-month period, including no more than $6 million on behalf of selling security holders that are affiliates of the issuer. In addition to qualification by SEC staff, companies offering securities pursuant to Tier 1 of Regulation A will also need to file and have their offering statements qualified by the state securities regulators in the states in which the issuer plans to sell its securities. Companies offering securities under Tier 1 do not have ongoing reporting requirements other than a final report on Form 1-Z on the status of the offering. Under Tier 2, an issuer can raise up to $50 million in any 12-month period, including no more than $15 million on behalf of selling security holders that are affiliates of the issuer. Unlike Tier 1 offerings, the offering statement does not have to be qualified by a state securities regulator, and the issuer is subject to ongoing reporting requirements in the form of an annual report on Form 1-K, a semiannual report on Form 1-SA, and a current report on Form 1-U. (Source: SEC official website) # The User Experience Creating a phenomenal buyer experience is critical at Homebase. We built our website and protocols to make it as user friendly as possible while still giving people full control of their assets if they so choose to take them off platform. To buy fractional shares of a home or participate in an initial home offering, users must go through the following steps: 1. Create an Account 2. Participate in Home Offering 3. Receive Home Tokens (or NFTs) 4. Collect Monthly Rental Distribution 5. Buy and Sell Home NFTs via Homebase platform #### **1. Create an Account** To begin buying partial real estate ownership through Homebase, users must first create an account on Homebase. In the account creation process , users will be asked to KYC, which is a legal requirement Homebase has to follow to comply with SEC securities regulation, and share whether they are an accredited or non-accredited investor. If accredited, [additional information](https://parallelmarkets.com/blog/a-guide-to-the-accredited-investor-verification-process#:~:text=Income%20method\&text=Some%20documents%20that%20can%20prove,tax%20documentation%20that%20report%20income.) will be requested to prove accreditation status. In addition, users will be asked to link their Solana wallet which will be the wallet used to receive real estate NFTs of the property that is purchased. #### **2. Participate in Home Offering** Homebase will periodically have home offerings available on the platform to invest in and each will have a limited time in which users can invest (typically last 30-35 days). All available data of the property will be showcased, including legal documentation, photos of the property, financial projections, etc. To participate in the offering, users can decide how many tokens of the property that they would like to purchase and complete the transaction on the platform. All transactions are done via USDC, a digitally-native coin pegged to the United States dollar one-to-one (meaning each USDC is worth 1 U.S. Dollar). During the home offering period, any funds committed to the purchase of the property will be held in an escrow account until the total amount of funds are collected to completely fund the purchase of the home. Alternatively, if the total committed capital for the property doesn’t meet the requirement to fully fund the home after the offering period, the transaction doesn’t go through and previously committed funds are returned to investors. #### **3. Receive Property NFT** After the home is completely funded, the transaction goes through and all buyers receive the property NFTs directly in their Solana wallet. #### **4. Collect Monthly Rental Distribution** Every month on the 15th, Homebase will disburse rent to all NFT holders based on their relative percent homeownership compared to the entire supply. Claiming rent can be done by logging into a user’s Homebase account, navigating to the dashboard, and clicking “claim rent” for a given property. All rental disbursements will be made in USDC and will be sent to the Solana wallet linked to user’s account. #### **5. Buy and Sell Home NFTs via Homebase platform** If a user decides that they want to sell their property NFTs, they will have the ability to initiate a sell order on our platform honored at fair market value at the time of the sale. Sales take 4 days to process, after which a seller will receive the fair market value of shares sold in USDC sent directly to the linked Solana wallet. Any sold NFTs will be available for repurchase on our platform at fair market value. ## Behind the Scenes of Your Investment

Behind the Scenes of Your Investment

# Risks to Homebase In the spirit of transparency, we want to share a few of the external risks that could affect Homebase’s goal of democratizing access to real estate investing and homeownership. ### **Major Recession** Major recessions negatively impact everyone, and Homebase is no exception. If housing prices drop 20-50%, it could change the public’s perception about real estate – that it’s a safe appreciating asset class – and lead less people to feel comfortable investing in real estate through our platform. In addition, major recessions lead to people having less disposable income and shifts their buying power from investments, to survival (food, clothing, housing, etc), rightfully so. Luckily we forecast the probability of that scenario being very low. The likely outcome is that housing prices potentially drop off up to 20%, with disposable income dropping accordingly, before it bounces back and continues to appreciate at a steady state. Multiple data points that make the outcome likely: a) The Fed recently stated that inflation is beginning to fall, b) there is a lack of sufficient housing availability in urban cities, and c) climate change will reduce livable land in the next 10 years. Each of these points lends itself to the conclusion that housing prices will likely recover within the year and continue to appreciate (becoming further and further unaffordable). ### **Prohibitive Regulation** One risk for all web3 companies is prohibitive regulation by the SEC and Congress. To be clear, we’re supportive of regulation, it lays out the rules of the game we have to follow and gives us a clear path of achieving our goal. The risk we see, however, is that in light of the recent exchange implosions (e.g FTX), it’s likely the SEC and Congress will pass additional regulation. Our hope is that the regulation introduced is not prohibitive to DeFi, NFTs, or crypto in general, making our business obsolete. The good news is that we’ve taken a very conservative approach to building Homebase. Regulation is front and center for everything we’ve done, which is why we a) built one of Solana’s first security token offerings to comply with securities regulation and b) are launching as securities from day one rather than finding loopholes to not be considered a security. Ultimately, even if the SEC brings about more prohibitive regulation, our meticulous approach will protect our users from being affected due to the heavy upfront legal setups that we've created. [Join us](https://homebasedao.io/) in redefining the way communities buy, sell and own real estate. # Account Creation This section provides a step-by-step guide on how to create an account and get started with Homebase, a platform for investing in real estate. {% embed url="" %} Follow this link to register for a Homebase Account {% endembed %} ## Create your Account The first step is to click on “Sign Up” on the Homebase landing page, and create an account.
If you already have a Solana wallet, use the “Solana Wallet Sign Up” button below. ![](/files/5PN81JthZjjeQagHihe3) ## Complete Signup Form You’ll be asked for the following information: > 🚨Important: Enter accurate, up-to-date information to avoid any issues. * Email address * Name * Accreditation Status * This is important because our offerings are structured as Reg D security offerings. Some investments will only be available to accredited investors. * How do you know if you are accredited? If you meet any of the following criteria: * The Securities and Exchange Commission (SEC) defines an accredited investor as someone who meets one of the following three requirements: * **Income:** Has an annual income of at least $200,000, or $300,000 if combined with a spouse’s income. This level of income should be sustained from year to year. * **Professional**: Is a “knowledgeable employee” of certain investment funds or holds a valid Series 7, 65 or 82 license. * **Net Worth:** Has a net worth of $1 million or more, either individually or together with a spouse, but excluding the value of a primary residence. * If you check yes, you will be required to submit proof of accreditation, detailed in the [Proof of Accreditation Section](/creating-an-account/identity-verification#optional-proof-of-accreditation). * Country of Residence ![](/files/SAfgJFuAOC0LAP2gN256) ## Confirm your Email Homebase will send you a verification email to your registered email address. When you get to this screen, open another tab or window to check your email for the verification email from and paste the code in the input box labeled “Code”. ![](/files/OjaIsUetXPlYZEQhAlIj) To create an account go to . # Identity Verification To complete verification, go to your Homebase dashboard and follow the steps as outlined here. {% embed url="" %} Follow this link to complete your KYC ID verification process. {% endembed %} ## Why do we require users to verify their identity? To comply with US securities regulation, we are required to KYC ([Know Your Customer](https://www.finra.org/rules-guidance/rulebooks/finra-rules/2090)) users who want to invest in the homes listed on our platform. KYC procedures help prevent identity theft, money laundering, financial fraud, terrorism financing, and other financial crimes. We use [Persona](https://withpersona.com/) to confirm the identity of users who invest on our platform. All information shared to Persona is kept confidential and private. ## Initiating Identity Verification To begin the process of verifying your identity, you will need to click the “Verify Me” button in the bottom left of the dashboard page.

Homebase Onboarding

## Completing Identity Verification via Persona Complete the steps outlined on Persona, the process takes 2-5min. To complete the steps, the following is required: * Identification card or document (Driver’s License, Passport, etc) * A well-lit, indoor space free of glare or visual noise that will cause your KYC submission to fail * A clear view of your face for KYC verification. Please make sure to remove your glasses before beginning KYC. If you are using desktop to initiate Persona KYC, you will have the option to switch to phone at almost every point during the document scans/photos. #### Example of the Process: A pop-up modal will appear and ask you if you wish to begin verifying your identity through Persona.

Persona is Our Third-Party Provider for Identity Verification

You will then select the issuing country of your government ID.

Persona Dropdown for Issuing Country of Your ID

From there, you will select the type of ID you would like to use for KYC purposes.

ID Document Selection

You will then be prompted to scan your document or a particular part of your document. You can either scan the document live, upload a scan of the document, or switch to phone to complete this task.

Document Scan Method Selection (Driver License)

After completing your scan, you will be prompted with a confirmation for that document and a final opportunity to check your photo for clarity of images/text.

Document Scan Confirmation (Driver License)

If you select 'Use this photo', Persona will proceed with an ID scan.

Document Scan Processing

If your identification document has a back side (e.g. a driver's license), you will be asked to present the back side of that document as well. Once those have been submitted, you will be asked to do a face match/liveness check by Persona. Press 'Get started' to proceed or continue with this process on your mobile device by pressing 'Continue on another device'.

Facial Scan Prompt

With a clear view of your face, calm background, and good lighting, you can complete this step quickly by scanning, looking left, then looking right.

Facial Scan Capture

After that, you're all done with Persona KYC!

Congratulations, your KYC has been submitted!

If you get to this step and hit done, your dashboard will now reflect the in-process status of your KYC via a grey clock symbol. Expect a response within 24 hours from Persona.

KYC Status: Processing

If your account is rejected for KYC scan (denoted by the red 'X'), you will have to re-submit. Reach out to to have your account reset.

KYC Status: Rejected

If your account is rejected for KYC scan (denoted by the green checkmark), your KYC step is completed and you can move on in the onboarding process.

KYC Status: Approved

At this point, book a meeting with someone from the Homebase team as your final step toward access to the platform and an opportunity for you to make your voice heard. ## (Optional) Proof of Accreditation If you indicated that you were an accredited investor, you will need to upload proof of accreditation. Why do we require users to share accreditation status proof? Since our home offerings are registered as Reg D security offerings, we are required by US securities regulation to verify [proof of accreditation](https://www.sec.gov/education/capitalraising/building-blocks/accredited-investor). To verify accreditation status, one of the following documents is required: * Letter from Licensed Third-Party (CPA, attorney, investment advisor, or an investment broker) * Series 7, Series 65, or Series 85 License * Proof of income (Bank or Brokerage Statements, 1040 Tax Return or similar, W-2 Form, 1099 Form) We verify accreditation status within 24 hours.
To complete verification, go to your [Homebase dashboard](https://www.app.homebasedao.io/dashboard). # Creating Your Wallet ## What is a wallet? Simply put, a wallet is a digital tool that allows users to send, receive, and store assets on the blockchain. It's similar to a bank account in the world of fiat currencies, but it operates within the decentralized environment of the blockchain. At Homebase, we use Solana as the blockchain for transaction settlement, but, ultimately, we do our home pricing and dividends in USDC, which is chain agnostic and pegged one-to-one to U.S. dollars. We're curating a simple user experience in which your wallet is self-custodial and acts as a brokerage account on Homebase. This means you’re the only person with access to your wallet and have sole control over your funds. Creating a wallet is a quick, simple process and we’re here to help make this as easy and straightforward as possible. ## Creating Your Wallet Through Homebase 1. Go to your Settings (either from the profile dropdown in the top right or from the menu on the left if you're in the dashboard).

Getting to Your Settings Page

2. Click wallet address.

Creating an Embedded Wallet

3. Press create wallet and your wallet will be provisioned for you.

Wallet Provisioning Step

After your wallet is created, you can purchase, deposit, and withdraw from that account at any time. You'll be able to see your wallet address within the settings tab as showcased below.

New Embedded Wallet Address

Now, whenever you purchase tokens in a Homebase property, those tokens will be distributed to this wallet. You have the ability to send and receive funds or tokens to this wallet. We're actively testing out new wallet creation flows on account signup, so this process may change in the future. ## Connecting an External Solana Wallet If you wish to connect your external Solana wallet and did not do so via the registration flow, email us at Note: Homebase does not store your private keys or secret passphrase for any reason. Your privacy and security are of the utmost importance to our team. If you want to create an external Solana wallet, the process of creating one is easy and takes under 5 minutes and you can do so via the link below. {% content-ref url="/pages/p8BEyJU5tkixv4sASrs9" %} [How To Set Up Your Phantom Wallet](/faq-and-guides/crypto-guides/how-to-set-up-your-phantom-wallet) {% endcontent-ref %} # Homebase Marketplace Guide When browsing the marketplace, you’ll see all the homes currently listed on the Homebase platform. You’ll be able to see: * Whether it’s available for investment * Projected IRR for the property * How many tokens are still available * Price per token

Marketplace Gallery

To view the marketplace, go to [app.homebasedao.io](https://www.app.homebasedao.io/). # Property Details Once you find a property you like and click on it, the first information you’ll see will pertain to property details. This will give you information related to the home including, but not limited to: 1. A general description of the property 2. Investment Summary 3. Features about the property 4. The location of the property on a map
To view the marketplace, go to [app.homebasedao.io](https://www.app.homebasedao.io/). # Property Market The market section of the property details page shares with you facts about where the property is located and why we believe the market has a positive outlook. 1. City Fast Facts – A few stats about the city in which the property is located in. You can see how the properties rental income and final price compares to the average home in the area. 2. Why ‘McAllen’ – General information about the city in which the property is located in and why we’re bullish on it. 3. ‘McAllen’ Historical Growth – a graph that showcases the historical price movement of the average rental property in the chosen market.
To view the marketplace, go to [app.homebasedao.io](https://www.app.homebasedao.io/). # Property Financials In this section, we share all financial data pertaining the home and our projects of what we believe returns will be over a 5 year holding period. ## **Financial Summary & Definitions** * **Total Investment Value** is the final price of the home including Homebase fees and the capital maintenance reserve amount. Home tokens trade with both these fees included in the token price. * **Underlying Asset Price** is the market value of the home * **Homebase Closing Fee (4%)** is the fee that Homebase charges on the sale of the home for all the services done to get the home on-chain and fractionalized * **Maintenance Reserve (5%)** is the amount of money held in an escrow account on behalf of the LLC which is utilized whenever improvements to the property is needed. Whenever there’s a delta between required reserves and actual reserves, it is refilled via rental income from the property. * **Total Returns (IRR)** is the projected average annual growth rate of your investment in this property over a 5 year hold period (includes rent and appreciation). * **Projected appreciation** is the estimated increase in home value each year. * **Average 5 year ROI** is the average projected return on investment over a 5 year time horizon based on rental cash flow minus expenses * **Cap rate (capitalization rate)** is a rate of return commonly used to evaluate real estate investments. It is calculated by dividing the net operating income (annual cash flow) by the value of the asset (home price). * **Monthly Gross Rents** is the full amount of rent paid by the tenant each month * **Vacancy rate** is the projected period of time in which the property will not have a renter. This is primarily for risk mitigation * **Monthly utilities** is the projected utility cost for the property each month which includes water bill, electricity bill etc. * **LLC Franchise Tax** is the yearly expense required to pay to the State of Delaware for managing the property via LLC * **Property Management Fee** is the monthly cost paid to local property managers to take care of the property. * **Total Monthly Costs** is the sum of all projected expenses for the property each month including but not limited to: * Utilities * Property Management * Repairs * Vacancy * Property Taxes * Insurance * **Expense to Income Ratio** is the total monthly costs divided by your monthly pre-tax income (rent). * **Monthly Cash Flow** is the net operating income expected on the entire property each month. Effectively, rent minus expenses.
Within the property financials page is also a returns calculator. Using the sliders or data entry on the right side, you can adjust the number of tokens to be purchased, annual appreciation expected, or the annual cash flow. The calculator will output cumulative returns including cumulative appreciation and cash flow.
To view the marketplace, go to [app.homebasedao.io](https://www.app.homebasedao.io/). # Property Documents In this section we share all documentation pertaining to the property included but not limited to: * Certificate of LLC Formation – which is a document filed with the secretary of state in some states to form an LLC * Property Inspection Report – which is a visual inspection of a property as part of a real estate contract. The home inspection can expose any potential issues with the property that might need to be addressed prior to the closing of the sale. * Property Appraisal Report – is a written report that estimates the current fair market value of the property that you are buying or selling conducted by a real estate professional * Security Token Purchase Agreement – is an investment contract representing the legal ownership of a physical or digital asset that has been verified within the blockchain * Offering Memorandum – is a legal document that states the objectives, risks, and terms of an investment involved with a Reg D private placement offering * Risk Disclosures – is a document that shares the relevant risks with the associated real estate investment
To view the marketplace, go to [app.homebasedao.io](https://www.app.homebasedao.io/). # Property Buying Process In this section we share all the pertaining dates towards the sale of the property ## Project Timeline * Home Under Contract – the date in which Homebase and the homeowner sign an exclusive buyer and seller agreement that let’s Homebase sell the property on behalf of the owner * Home Offering Privately Available to Waitlisted Users – the date that the home offering goes live to an exclusive list of waitlisted users. At this point both accredited and non-accredited investors can participate. * Home Offering Available for Purchase to Public – the date that the home offering is publicly live, and open to only accredited investors. * Home Offering is Sold Out – the date that all the tokens of the property are sold out
To view the marketplace, go to [app.homebasedao.io](https://www.app.homebasedao.io/). # Checking Out This section describes and provides a guide for the investment process through Homebase. Let's say that after viewing all important property details within [Using the Marketplace](/using-the-marketplace/homebase-marketplace-guide) you decide that you want to invest in a particular property. Here's how you would proceed on the Homebase platform: ## 1. Make Sure Your Wallet is Ready As part of checkout at Homebase, make sure that your wallet has enough USDC on the Solana blockchain to complete your purchase. You can use the tools within [Property Financials](/using-the-marketplace/property-financials) to calculate your expected return based on the number of tokens that you wish to buy. Additionally, check that you have enough SOL to cover gas fees. For more on gas fees, you can read more within [What are Blockchain Gas Fees?](/faq-and-guides/crypto-guides/what-are-blockchain-gas-fees). We recommend that you keep at least 1 SOL to make sure you have enough to cover gas fees during checkout, after which you can transfer your SOL back to USDC or any currency that you wish. ![](/files/mrHCW2baqJ4oogmhMaOu) Our team at Homebase recommends using Phantom for checkout at this time and have a detailed guide for setting up your wallet within [How To Set Up Your Phantom Wallet](/faq-and-guides/crypto-guides/how-to-set-up-your-phantom-wallet). ## 2. Connecting Your Wallet Within the property details page, guide your mouse to the grey box underneath the photos to the right side. No matter what page you are looking at within property details, this grey box should be in view. If a property is not yet live, the button will be greyed out with a timer counting down to the live date. You cannot purchase tokens at this time, but, instead, you can declare interest and our team will keep you informed when this home is live.
If it is live, go ahead and proceed with the next steps. If you have a wallet extension connected to your browser or are using a wallet-native browser (such as the one within the Phantom app), our website should detect the wallet you are using. If it does not detect your wallet of choice, shoot us a message through Intercom or email us at . If your wallet is detected, go ahead and press the Connect button as highlighted in red below.
## 3. Click the "Invest" Button After your wallet has been connected, the purple "Connect" button will turn into a blue "Invest" button with the USDC symbol. Click that new blue button when it appears, as shown in the red box below.
## 4. Review the Transaction / Agreements and Checkout At this point, a modal will pop up in the center of your window detailing the property that you are investing in as well as the number of tokens to purchase. Additionally, the total cost, including the total USDC to be used for purchase as well as projected gas fees, is detailed at the bottom of the modal in addition to links to the Terms of Service, Security Token Purchase Agreement, and Operating Agreement. The "Confirm Checkout" button will be greyed out and unclickable at this time. You can use the + or - symbols to the right of "Quantity to Purchase" to adjust the number of tokens you wish to purchase. Note that each property has a minimum number of tokens that can be purchased and that will be programmed into the modal and buttons.
If all of the details look good to you, simply click the checkbox on the bottom left of the modal. The greyed out "Confirm Checkout" will then turn blue and you can initiate checkout by clicking this "Confirm Checkout" button.
## 5. Approve the Transaction After clicking "Confirm Checkout", the button will again grey out and a loading symbol will appear. After \~5 seconds, your wallet should display a popup showing your NFT's for purchase in addition to the USDC to be paid and gas fee (in SOL) to be used. To confirm your transaction, click the "Approve" button.
## Next Steps It will take a few moments for your transaction to complete, after which you will be automatically moved to the purchase verification/signature page. For more details, go to the next page. {% content-ref url="/pages/fkeQza2m54c5A68vQ2Zp" %} [Signing the Appropriate Legal Documentation](/investing-with-homebase/signing-the-appropriate-legal-documentation) {% endcontent-ref %} All investments are made in home offerings via USDC by minting non-fungible tokens on our platform. The tokens get sent automatically to your Solana wallet after purchase and become active after the home successfully sells out and the deed of the house is properly transferred into the new LLC. Shared content and posted charts are intended to be used for informational and educational purposes only. Homebase does not offer, and this information shall not be understood or construed as, financial advice or investment recommendations. The information provided is not a substitute for advice from an investment professional. Homebase does not accept liability for any financial loss or damages. For more information please see the terms of use. # Signing the Appropriate Legal Documentation After payment is submitted, multiple legal documents are sent to your email address that are required to be signed * LLC Operating Agreement – this document outlines the financial and functional decision-making of the LLC holding the real estate property. It is similar to articles of incorporation that govern the operations of a corporation. * Security Token Purchase agreement- this legal document outlines the terms and conditions of a transaction in which a purchaser agrees to acquire security tokens issued by a company or entity. ![](/files/RSZAa74ZpNuCk3q9zb3K) ![](/files/LV4hP3aRGKEYsjpsVwYT) ![](/files/gZdIKrPYs0LGNJCu95w2) ![](/files/FdSaxzds3hAyizvSkIKn) ![](/files/vSDxr72OImuAe7CzV9lB) ![](/files/0F9GDhjQNOvbT6FmAxL5) # Closing Period Funds are held in escrow during the 35 day duration during which a home offering is live. If the home is successfully sold out, the transaction goes through and Homebase begins managing the property. If the home doesn’t sell out, funds are refunded to the original wallet in which the funds were received from. After closing of the escrow period and successful sell out, here are the major milestones you should look out for: * The property will be marketed and the tenant will be placed. * First month’s rent should be processed on the 15th of every month starting in the month after the purchase is closed. * Updates will come out on a monthly basis regarding any changes with the tenant or the property. * In Q1 of the following year, we will distribute tax paperwork for ownership. * The lockout period will end one year after closing and completion of paperwork. This will be made clear to all investors. This will allow you to redeem your NFT at the proportional value of the property’s fair market value. # After Investment This section provides important information about the lifecycle of investments after users invest. Homebase will begin management of day-to-day operations of the property. In doing so, we will hire local property managers to manage the home, and collect and distribute out rent to all holders. ### **Property Dashboard** 1. **Investing Summary** – A summary of your investments and cash flows through Homebase. 2. **News** – An aggregation of news articles, blogs, and thought pieces by or involving Homebase. 3. **My Properties** – A list of the properties owned by you. 4. **Transactions** – A list of transactions associated with your account including investments, cash flows, and withdrawals.

Homebase Dashboard

### How to Collect Rent On the 15th of each month, you will be sent a dividend equal to the proportional amount of rent that you are owed for that month. If you don’t immediately receive the dividend after our monthly roundup email, reach out to us at . ### **Settings Tab** 1. **Properties Owned** – total number of properties you've invested in 2. **Total Invested** – total dollar amount invested across all properties 3. **Name** – the name of your account 4. **Email** – the email associated with your account 5. **Password** – the password associated with your account necessary to login 6. **Wallet Address** – the Solana wallet associated with your KYC'd account, this is important because wallets gets whitelisted to receive tokens, which we are required to do so to comply with US securities regulation 7. **KYC Verification** – will showcase status of KYC submission, whether verified or not 8. **Accreditation** – will showcases status of Accreditation, if you originally put you were not accredited and want to change to accredited, it is necessary to submit a ticket via intercom on the bottom right of the screen 9. **Support** – get in touch with the team via Intercom

Settings Page

### **Property Values** Homebase updates the market value of property prices monthly, which we source from 3rd party providers and data oracles. ### **Selling your Investment** Homebase properties are issued via Reg D security offerings, and thus there’s an initial 1-year holding period for the investment. After the 1-year period is over, you are free to sell whenever you’d like. To initiate the sell of your property tokens, you’ll notify the team that you’d like to sell through the dashboard. Within 72 hours we’ll process the request and buy back the tokens from you at market price, minus trading fees. # Frequently Asked Questions This section provides answers to frequently asked questions. ## What is Homebase? Homebase is a platform that enables users to invest in tokenized residential real estate for as little as $100. Using blockchain technology, Homebase provides investors the ability to purchase tokenized single family rental properties with one click, and transact with USDC, cutting the time and cost incurred by legacy systems. ## Why does Homebase have DAO in its name? For context, a DAO, or decentralized autonomous organization, is an emerging form of legal structure that has no central governing body and whose members share a common goal to act in the best interest of the entity. The properties we bring on-chain and fractionalize are managed via an LLC where token holders have voting rights over the property, similar to how members vote within a DAO. Homebase is the de-facto property manager and will manage day to day operations, but LLC members will be able to vote on changes or proposals directly with their tokens if needed. ## How much can I invest? Users can invest with as little as $100 in each property offering. ## When do I start getting rental income? Users start receiving rental income starting the month after a property fully sales out and closes. Homebase will then start managing the property and distribute out rent monthly. ## Why put real estate on the blockchain? By using blockchain technology, Homebase users and investors will also have access to transparent and traceable sources of data to all homes tokenized on the platform to showcase things like month-to-month price changes, transaction history, and legal documentation. In addition, blockchain allows for greater ownership, utilization of existing payment rails, and expansion into new financial tooling in the future. ## What is an NFT? An NFT, which stands for non-fungible token, is a unique unit of data employing technology that allows digital content—from videos to songs to images—to become logged and authenticated on the Solana blockchain. Once content is logged onto the blockchain, every transaction from transfers to sales is recorded on-chain, creating an easily accessible ledger of transparency and traceability. The main impact of NFTs is making it easy to own and sell an asset on-chain, such as real estate. For more information about NFTs, see our Crypto Basics guide about NFTs in[#what-is-an-nft](#what-is-an-nft "mention") and always feel free to send any questions to . ## What does fractional ownership mean? Fractional ownership refers to a form of shared ownership in a property where multiple individuals each own a share of a home, and collectively own the entire thing. Being a fractional owner of a Homebase property means that you will benefit from that property's future appreciation and cash flow, but won’t have to worry about any of the property management. ## Why fractionalize real estate via tokens? Real estate price growth has outpaced wage growth for the past 10 years. At a median price of $400,000+ in the US, we think it’s necessary to fractionalize real estate in order to give more individuals the opportunity to capture the upside from capital appreciation. We chose NFTs to fractionalize real estate because unlike other physical assets, real estate transactions don’t require any physical interaction with the property, only a transfer of document ownership. ## How does this structure work legally? After a detailed sourcing, selection, and due diligence process, Homebase puts the residential property under contract and sets up an SPV (Special Purpose Vehicle) to hold the asset. Using that SPV, Homebase issues a private (e.g. Reg D) or public (i.e. Reg A+) fund via the so-called STO (Security Token Offering) process. After the filing (and/or approval) with the SEC (the U.S. Security and Exchange Commission), Homebase issues non-fungible security tokens using the Metaplex NFT standard, and ensures that certain guardrails and functions are available to these tokens to enforce the laws governing these securities ## Are Homebase legally compliant? Absolutely! Homebase tokenizes high quality rental homes via security tokens, which are tokens regulated by securities laws. Token investors can have the peace of mind that their investments are safe, legal, and secured by blockchain technology. ## What is a security token offering? A Security Token Offering (STO, i.e. tokenized IPO) is a type of public offering in which tokenized digital securities, known as security tokens, are sold in security token exchanges. Tokens can be used to trade real financial assets such as equities and fixed income, and use a blockchain virtual ledger system to store and validate token transactions. ## What are security tokens? Security tokens are digital assets that represent transferred ownership rights or asset value to a blockchain token. The concept is the same as buying shares of stock on a traditional stock exchange. These tokens are regarded as securities by financial regulatory authorities. and are subject to regulation, just like ordinary stocks and bonds. ## How are homes sourced? Homebase sources the best properties and deals with partnerships through our real estate network, which includes real estate professionals such as agents, brokers, and investors. Our team of experienced investors sources and underwrites deals with particular focus on stable, cash-flowing properties in great neighborhoods. ## What happens after a home is sold on your platform? After a property is fully sold, Homebase goes through the closing process which means transferring title from the home owner, to the LLC acquiring the property. After, Homebase begins to manage day to day operations of the property. They do this by hiring local property managers to manage the home, and collect and distribute out rental income monthly to all owners. ## Who can participate in the home offerings? At this moment, only US investors are able to invest in our home offerings. In addition, the investment is limited to 35 non-accredited investors and 250 accredited investors. We plan to switch to Reg A offerings at a future date that will let anyone, regardless of accreditation status or country, participate in the property offerings. ## Does Homebase take a stake in the house as well? Homebase acquires 1% of the property value for each home sold on the platform to align our incentives to our users. ## How are properties acquired? Is a mortgage utilized? All homes are acquired with 100% equity, no debt is involved in the financing process. This is so that there is no risk of the property ever being foreclosed by the bank if monthly payments aren’t maintained and so that fractional owners can decide themselves if they’d like to take on debt by collateralizing their property tokens. At a future date, we plan to partner with on-chain debt providers to allow for users to stake their tokens to take out debt. ## What happens to the deed of the house and property title after the sale of the home? The title of the home is transferred from the owner selling the property, to the SPV that Homebase created to acquire the home. ## How are rents distributed? Rent is distributed proportionally each month to each owner based on the percentage of the home owned via tokens. Each month, holders can go to the Homebase platform to redeem their portion of the rent and rent can be withdrawn to the wallet which holds the ownership token, similar to how dividends are distributed for stocks. For instance, if you own 10% of the home, you will receive 10% of the net cash flow each month (rent minus costs). ## How does an investor sell their tokens when ready to exit? At launch all homes will be issued via Reg D security offering. Under the current Reg D structure, investors are required to hold their investment for at least a year. After that one year hold period, investors are free to sell when they’d like directly on the Homebase platform. Homebase acts as the market maker to these sales, which we buy at fair market value as dictated by 3rd parties (HouseCanary, Tophap, etc). ## How do property taxes get paid? Homebase manages the payment of property taxes on behalf of all investors. ## How do investors deal with their own personal taxes? Homebase delivers each investor a K1 at the end of each tax year. ## What is required to trade on your platform? To participate in home offerings, users need to: * Make an account * Verify their identity (which we’re required to do to comply with Know Your Customer laws required with security offerings) * Confirm accreditation status if they are accredited * A Solana Wallet to purchase tokens with USDC ## What happens if a user’s wallet gets hacked or if tokens get stolen? Homebase has protections and processes to protect our users from any sort of crypto hack or leak. Each home token ownership agreement allows for reissuing of assets to the original owner upon proof of hack. ## What happens if major capital is needed for repairs or a voted resolution of improvement? When the home is initially fractionalized and sold, a capital expenditure reserve of 5% of the home price is included in the final sale price. This money is drawn as needed to fix major repairs in the home and is replenished via rent collected from landlords. Capital calls from fractional investors is the last resort. ## What happens if Homebase goes out of business? Each of our offerings are registered as their own independent LLC. If Homebase would go out of business, users are protected in that the LLC would be able to operate as an unaffected entity. In that case a new manager would need to be voted in to manage the property or members can vote to sell the property in the open market and distribute out funds received from the sale. ## How are properties acquired? Is a mortgage utilized? All homes are acquired with 100% equity, no debt is involved in the financing process. This is so that there is no risk of the property ever being foreclosed by the bank if monthly payments aren’t maintained and so that fractional owners can decide themselves if they’d like to take on debt by collateralizing their property tokens. At a future date, we plan to partner with on-chain debt providers to allow for users to stake their tokens to take out debt. ## Does Homebase take a stake in the house as well? Homebase acquires 1% of the property value for each home sold on the platform to align our incentives to our users. ## Who decides if/when to sell the property? Each individual owner can decide to sell the property on their own terms. The beauty of fractionalizing the property via security tokens is that each individual has the capability of selling their shares when they’re ready without relying on group approval or for the entirety of the property to be sold in the open market. ## How does Homebase calculate fair market value? To make sure investors get the best price when selling their tokens, we partner with 3rd party data providers who share what the fair market value of the property is which we update directly on the property page each month. ## How will you handle major securities regulation changes? Homebase will be staying up to date with changing legal regulation to ensure that our processes follow all relevant laws, and will change when appropriate. If you have any additional questions, you are always welcome to email us at . # Crypto Guides This section provides a comprehensive overview of blockchain technology and cryptocurrency, exploring topics such as smart contracts, NFTs, gas fees, and the fundamentals of digital currencies. It also delves into Solana, a high-performance blockchain protocol, and explains how Homebase utilizes these technologies to enhance its platform's security, transparency, and efficiency. # How To Set Up Your Phantom Wallet ### What is a Phantom Wallet? Whether you’re new to cryptocurrency or you’re interested in the many Solana projects out there like Homebase, setting up your Phantom wallet can feel pretty daunting. But, it's really a quick, simple process and we’re here to help make this as stress-free and straightforward as possible. Phantom is a non-custodial wallet, which means you’re the only person with access and sole control over your funds. A phantom wallet makes it possible for you to use any decentralized applications built on the Solana blockchain, including Homebase. ### Installing Phantom and Creating Your Wallet #### Desktop Download the Phantom wallet extension [here](https://phantom.app/download) and select your preferred browser. Simply follow the steps outlined after clicking on the preferred browser. After the install is complete, a new tab will appear with the option to create a new wallet; click “Create New Wallet.”
You’ll then need to write down your recovery phrase and store it away in a secret location. If you can’t access your wallet for any reason, this phrase will allow you to recover your wallet. If you lose your recovery key, no one can help you get your funds back.
‍**Never, ever ever ever**, give your recovery phrase to anyone. It’s recommended that you write the phrase down on a few different pieces of paper and store them in separate locations around your home. Finally, just look for the Phantom icon in the browser toolbar, which, if you’re using Chrome, will be at the top right-hand side of your browser. Sometimes it won’t pin to your browser, so you’ll need to press the puzzle icon, which will give you a list of all your extensions; you simply just click the pin icon next to Phantom, and it’ll then appear by default at the top right-hand corner of your browser.
#### Mobile (iOS/Android) Visit and select the app marketplace according to your device type (iOS/Android). You will be redirected to the Phantom application on your device app store, follow the steps to download and install the application on your device. After installing, open the app and you should see the Phantom onboarding screen to set up a new wallet. \ \ If you are a brand new user, select "**Create a new wallet**" and enable the device authentication (may vary according to the device type) to protect your wallet from unauthorized access. If you are an existing user, you can select "**I already have a wallet**" and enter your seed phrase to restore your wallets. ![Frame\_29\_\_1\_.png](https://help.phantom.app/hc/article_attachments/12423784681235) Store your "**Secret Recovery Phrase**" in a safe and secure location, it is the only way to recover your wallet. The phantom team does NOT have access to your seed phrase nor will we ask for the phrase, ever! If someone has access to your seed phrase, they will have complete control of your wallet forever! Note: You can enable notifications to get instant updates about your wallet activity. These can also be customized in Settings - Notifications. ### Locating Your Wallet ID Your wallet ID, a.k.a. public key or pubkey for short, is named within the token purchase agreement to tie your representative ownership to the tokens held within your wallet. As such, if you need to find your wallet ID for whatever reason, you can find it at the top of your Phantom wallet as shown in the screenshot below. If you're on desktop, simply hover your mouse over the Wallet Name (in this case, "Homebase") at the top and copy the "Solana" wallet that appears. If you're on Mobile, click the wallet name at the top and copy the "Solana" wallet.

Finding Your Solana Wallet ID / Pubkey

{% hint style="success" %} If you're investing on Homebase via wire or debit, this is the end of the relevant part of the guide for you. Simply send this pubkey over to the Homebase team to help them complete your transaction. {% endhint %} ### Buying SOL The most popular ways to buy Solana are using either [Coinbase](https://www.coinbase.com/) or [Binance](https://www.binance.com/). So, let’s say you’ve set up your Coinbase account, head to the Solana market page, and click the Buy / Sell button at the top right.
A pop-up will then appear; you simply insert the amount of money you want to invest into Solana, click preview buy, and then confirm the purchase.
Congrats! You’ve just bought your first Solana. ### Buying USDC on Coinbase 1. Once your payment method is set up, you can go to the "Buy/Sell" tab in your Coinbase account and select USDC from the list of available cryptocurrencies. 2. Enter the amount of USDC you want to purchase, or the amount of money you want to spend, and select your payment method. 3. Review the details of your purchase and click "Buy USDC" to complete the transaction. 4. You should now see your USDC balance in your Coinbase account. 5. Click “Send & Receive” in the upper right corner, and enter your Phantom wallet address # to send. Read the full article on Coinbase [here](https://www.coinbase.com/blog/send-and-receive-crypto-on-multiple-networks-starting-with-polygon-and-solana). ### Transferring SOL to your Phantom Wallet Now it’s time to transfer your Solana from Coinbase to your Phantom wallet; the process will be almost identical regardless of the exchange you’re using. Click the Phantom icon on your browser, a pop-up will appear, click the receive button, a search bar will appear, type in Solana and click. ‍
It’ll then lead you to a small page with a barcode and your Solana wallet address, hit copy. ![](/files/aGGMaPOow2aqyeVzLCnp) If you’re using Coinbase, click the option to Send / Receive right next to the Buy / Sell button at the top right corner.
Enter how much Solana you’d like to send to your phantom wallet, then paste your Solana address into the address bar.
Once you’re happy with everything, hit send now, and then check your Phantom wallet to make sure it’s delivered. And voilà, you now have Solana in your Phantom wallet, ready to use on any Solana Dapp and investing in real estate assets on Homebase[.](https://www.parcl.co/) \ Note: Homebase does not store your private keys or secret passphrase for any reason. Your privacy and security are of the utmost importance to our team. Shared content and posted charts are intended to be used for informational and educational purposes only. Homebase does not offer, and this information shall not be understood or construed as, financial advice or investment recommendations. The information provided is not a substitute for advice from an investment professional. Homebase does not accept liability for any financial loss or damages. For more information please see the terms of use. # Bridging Assets to Solana Learn how to easily transfer cryptocurrencies between Solana and other chains using cross-chain bridges and exchanges. At Homebase, we're proud to be building on the [Solana blockchain](https://solana.com/) and even prouder to have brought the [first home on-chain to Solana](https://blockworks.co/news/real-estate-investors-buy-nft-home). This means that any crypto payments initiated from a personal wallet must be done on Solana. For anyone with assets primarily on other chains such as Ethereum, if you want to use your Ethereum assets on Homebase, assets must either be *bridged* to Solana or converted via a centralized exchange, also known as a CEX. Before using any bridge or exchange, be sure to perform your own due diligence. Homebase is not responsible for loss of assets during transfer of assets across chains. ## What Are Bridges? Cryptocurrency bridges are an integral part of the blockchain landscape. As their name suggests, these provide a bridge through which information and assets can be moved from one independent chain to another. Solana, like other blockchains, can use bridges to interact with different blockchains, ensuring that assets and data can flow between the Solana network and other networks. For example, you might use a bridge to directly convert your Ethereum into Solana. The exact mechanism used to accomplish this varies depending on the bridge used, as well as the assets and blockchains involved. But in most cases, the bridge will simply lock the assets on the source chain, before minting an equivalent number of the same asset on the destination chain. This ensures value is effectively transferred without changing the circulating supply of the assets being moved. In most cases, bridging your assets to Solana is a quick and simple process. Your assets will usually be moved to Solana in less than just minutes. For the purposes of this tutorial, we’ll look at how you can bridge USDC using Allbridge and other assets using Portal. ### How to Bridge USDC to Solana Using Allbridge Core For bringing USDC from EVM-based chains, such as Ethereum, to Solana, you can use Allbridge Core. [Allbridge Core](https://home.core.allbridge.io/) is a cross-chain protocol for swapping stablecoins. The swap platform ensures smooth transactions and cross-chain swaps between stables without the need for the wrapped assets. Here's how to do so: #### Step 1: Select the Chains You Want to Send USDC From First, you’ll need to go to the [Allbridge Core swap page](https://core.allbridge.io/) and tell the bridge which chain you want to transfer from. This means selecting the source chain (the chain you’re moving your assets from).

Allbridge Core (Swap)

If the source chain and asset (USDC from Ethereum in this instance) are correct, move to Step 2. Otherwise, click the dropdown for USDC from Ethereum.

Select Your Source Asset and Chain

A pop-up modal will appear, giving you multiple options to choose from on your source chain including: * Arbitrum * BNB Chain * Ethereum * Polygon * Solana * Tron There will also be multiple assets (stablecoins) to choose from so be sure to choose the correct source asset. In this instance, you will likely be choosing USD Coin (USDC) on Ethereum.

Modal for Selecting Source Chain and Asset

#### Step 2: Select the Chains You Want to Send USDC To Next, you’ll need to tell the bridge which chain you want to transfer to. This means selecting the target chain (the chain you’re moving your assets to). Similar to Step 1, if the target chain and asset (USDC from Ethereum in this instance) are correct, move to Step 3. Otherwise, click the dropdown for the target chain / asset.

Select Your Target Asset and Chain

A pop-up modal will appear, giving you multiple options to choose from. Select Solana then select USD Coin (USDC).

Modal for Selecting Target Chain and Asset

Your view on Allbridge Core should now have the proper source asset and target asset selected. If it looks like the photo below, proceed to the next step.

Allbridge Core Swap with Proper Source and Target Assets Selected

#### Step 3: Connect Your Wallets Next, you will have to connect the wallet containing your source of funds and the destination wallet where your target asset will be sent to. First, press the upper "Connect Wallet" button.

Connecting your Wallet with Allbridge Core Swap

A pop-up modal will appear asking you to "Choose Wallet". Choose the wallet where your source asset is contained and connect that wallet via the wallet extension.

Modal with Source Chain Wallet Providers

After that is complete, you can select or paste in the address of your destination wallet.
When you select "Connect Wallet" another pop-up modal will appear, allowing you to select the custodian of your wallet. In this instance since USDC on Solana is the target asset, Solana wallet custodians are shown. Connect that wallet via the wallet extension.

Modal with Destination Chain Wallet Providers

With your wallets connected, you are almost ready to bridge your USDC! All that remains is selecting the amount to send.

Allbridge Core Swap is Fully Connected!

#### Step 4: Input Amount to Bridge and Complete the Bridging Process Enter the amount in the top box that you'd like to bridge from your source wallet to your destination wallet. After you input this information, the amount to be received will auto-populate along with a list of all fees or swap costs. If everything looks good, go ahead and press the approve button to proceed with the transaction.

Allbridge Core Swap with a Source Fund Input of 1 USDC

The extension of your source wallet will then provide a pop-up window with an input button. Approve that transaction in the window then press the send button on the Allbridge Core Swap page.

Confirm the Transaction from the Source Wallet Extension

At this point, a "Transaction Success" notification should appear in the bottom left corner with a link to view the transaction on-chain. After about 15-20 minutes (depending on the transfer time indicated) you should receive your bridged assets. Congratulations! If you have any questions as you go through this process, reach out to the Homebase team at .

A "Transaction Success" Notification Should Appear on the Bottom Left of Your Screen

### How To Bridge Other Assets to Solana Using Portal In most cases, bridging your assets to Solana is a quick and simple process. Your assets will usually be moved to Solana in less than just minutes. For the purposes of this tutorial, we’ll look at how you can bridge assets using Portal.
Portal is by far the most popular Solana bridge by TVL, Portal supports Solana and 23 other L1/L2 chains. The platform has a flat bridge fee of 0.04% with a maximum fee of 1,000 USDC. #### Step 1: Select Your Chains First, you’ll need to tell the bridge which chains you want to transfer between. This means selecting the source chain (the chain you’re moving your assets from) and the target chain (in this case, Solana).

Select Your Source Chain and Target Chain

#### Step 2: Connect Your Wallet With the chains now selected, click the 'Connect' button to select your [Web3](https://coinmarketcap.com/alexandria/glossary/web-3-0) wallet. This will pull up a prompt asking you to select from the range of supported wallet providers. Choose the one that applies to you and connect your wallet when prompted. #### Step 3: Select an Asset Once your wallet is connected, you’ll be able to choose from the list of supported assets using the ‘Select a Token’ drop-down menu. From here, select from the range of featured markets or search for the name of the asset you wish to transfer. In many cases, the interface will automatically load your balance for the selected asset, helping you correctly identify the right token.

Select a Source Asset. Portal Will Auto-Detect Source Assets

Once you’ve selected your target asset, enter the amount you wish to bridge in the ‘Amount’ field. #### Step 4: Connect Your Solana Wallet It’s time to connect your Solana wallet. Click the 'Connect' button and select your Solana wallet from the list of supported options.

Connect Your Solana Wallet

After selecting the relevant option, connect to the bridge by following the prompts in your wallet. #### Step 5: Create Associated Token Account With your origin and target wallets now connected, you may need to create the associated token account in your Solana wallet. This will allow you to receive the token.

"Create Associated Token Account" Button

Click the ‘Create associated token account’ button and approve the transaction in your connected Solana wallet. If you already have an associated token account, move to step 6. #### Step 6: Bridge Your Funds You’re now ready to bridge your funds. In the subsequent section, approve the token transfer via the bridge interface and confirm the transaction in your connected wallet. Once this has been approved, send the assets to the bridge using the ‘Transfer’ button.

"Approve 0.5 Tokens" Button

Portal will then begin the process of bridging your funds from your source wallet to the destination chain. It’ll keep you notified of its progress on-screen. #### Step 7: Claim Your Tokens Once the bridge process is complete, you’ll be able to claim your tokens from the bridge using your Solana wallet. To do so, simply click the “Redeem’ button (when available) to claim your tokens. If you have any questions as you go through this process, reach out to the Homebase team at . ### How To Bridge to Solana Using a CEX While the aforementioned options are available, users also have the option to bridge tokens from Solana to other blockchains using a centralized exchange (CEX). However, it is crucial to be aware of the security risks associated with using a CEX for bridging. Here is a step-by-step guide on how to bridge tokens from Solana to the Ethereum network using a CEX: 1. Open an account with a CEX like Coinbase. 2. Transfer ETH from your personal wallet to the CEX. 3. Once the ETH is received in your CEX account, you can convert it to a native token on the Solana network, such as SOL. If not, you can simply move to step 4. 4. Withdraw the SOL (or ETH) from the CEX and send it to your Solana wallet. It is important to note that while using portals like Allbridge and Portal is generally recommended for bridging, a CEX can be considered as an alternative option. However, it is essential to understand that CEXes often require users to undergo [Know Your Customer](https://coinmarketcap.com/alexandria/glossary/kyc) ([KYC](https://coinmarketcap.com/alexandria/glossary/kyc)) procedures and provide personal information. {% hint style="danger" %} Please keep in mind that the steps provided here are for informational purposes only, and it is always advisable to conduct thorough research and exercise caution when utilizing any bridging method. {% endhint %} ## About Solana Solana is a blockchain that boasts well over 400 active [decentralized applications](https://coinmarketcap.com/alexandria/glossary/decentralized-applications-dapps) ([DApps](https://coinmarketcap.com/alexandria/glossary/decentralized-applications-dapps)), many of which have established user bases. Meanwhile, the [total value locked](https://coinmarketcap.com/alexandria/glossary/total-value-locked-tvl) ([TVL](https://coinmarketcap.com/alexandria/glossary/total-value-locked-tvl)) across all Solana-based protocols now sits at [$648 million](https://coinmarketcap.com/chain-ranking/) — making Solana the 8th largest [layer-1](https://coinmarketcap.com/alexandria/glossary/layer-1-blockchain) by TVL. Since the launch of the Solana mainnet in March 2020, the platform has undergone several upgrades aimed at improving stability and efficiency, while maturation of the Solana developer tooling has made building on the platform simpler than ever before. # What are Blockchain Gas Fees? Blockchain technology is changing the world in ways we never thought possible. With its decentralized, transparent and secure nature, blockchain is quickly becoming one of the most talked-about technologies in recent times. In this article, we'll be diving deep into the concept of blockchain gas fees and how they work. ### **What are blockchain gas fees?** Before we dive into blockchain gas fees, let's take a step back and understand the basics of blockchain technology. A blockchain is a decentralized digital ledger that records transactions in a transparent and secure manner. Each transaction on the blockchain is verified by a network of computers (known as nodes) that work together to maintain the integrity of the ledger. A gas fee is a small amount of cryptocurrency paid by the user to incentivize miners to process their transaction on the blockchain network. These fees are an essential component of blockchain technology, as they ensure that the network is not congested and that transactions are processed quickly. ### **Why are gas fees on the Solana blockchain cheaper and more efficient?** Gas fees on the Solana blockchain are cheaper and more efficient for several reasons. Firstly, the platform's architecture allows it to process transactions in parallel, which reduces the overall time and cost required to process each transaction. Secondly, Solana uses a unique consensus mechanism called Proof of History, which allows it to process transactions more efficiently than other blockchains. Proof of History uses a cryptographic clock to timestamp transactions, which allows the network to process transactions in parallel without sacrificing security or decentralization. Finally, Solana's low gas fees are also due to the platform's ability to scale efficiently. Unlike other blockchains, Solana's architecture can handle a large number of transactions per second without sacrificing security or decentralization. This means that as the network grows, the cost of gas fees will remain low, making it an attractive option for users and developers alike. ### **How are blockchain gas fees calculated?** The calculation of blockchain gas fees is a complex process that takes several factors into account. The primary factors that affect gas fees are network congestion, transaction complexity, and the gas limit. The gas limit is the maximum amount of gas that a user is willing to pay for a transaction. If the gas limit is too low, the transaction may fail to be processed by the network. On the other hand, if the gas limit is too high, the user may end up paying more in gas fees than necessary. ### What is the Average Amount of SOL You Need per Transaction? The amount of SOL required per transaction on the Solana blockchain can vary depending on the complexity of the transaction and the current network congestion. However, the average amount of SOL needed per transaction is typically very low compared to other blockchains. As of March 2023, the average gas fee for a simple transaction on the Solana network is around 0.0001 SOL, which is equivalent to a few cents. This low cost is due to the platform's ability to process transactions in parallel and its efficient consensus mechanism, which reduces the overall time and cost required to process each transaction. It is worth noting that gas fees can increase during times of high network congestion, which is common for all blockchain platforms. During these periods, users may need to pay higher gas fees to ensure their transactions are processed in a timely manner. However, even during periods of high congestion, the gas fees on Solana remain relatively low compared to other blockchains. Overall, the low average cost of gas fees on the Solana blockchain makes it an attractive option for users and developers looking to conduct fast and cheap transactions. As the network continues to grow and evolve, we expect to see the cost of gas fees remain low, further solidifying Solana's position as a leading blockchain platform. When transacting on the Homebase platform, we will calculate the expected gas fees as part of your checkout process. Upon review of the transaction, be sure that you have enough Solana to cover gas fees in your Solana wallet. If you do not have enough SOL to cover the gas fees, your transaction will fail and the investment will be cancelled. If the transaction fails, you can always re-initiate the transaction after you have added an adequate amount of SOL into your wallet.
### How to Get SOL To use Solana for transactions, acquire SOL from cryptocurrency on Coinflow through Homebase's platform or through other exchanges. Transfer SOL to a Solana wallet like Phantom, Ledger, or Solflare to start making transactions. ### **Conclusion** In conclusion, blockchain gas fees are an essential component of blockchain technology. They incentivize miners to verify transactions on the blockchain network, ensuring that the ledger remains secure and transparent. Gas fees also help to filter out spam transactions and ensure that only legitimate transactions are processed. We hope that this article has provided you with a comprehensive understanding of blockchain gas fees and how they work. If you have any further questions or would like to learn more about blockchain technology, please feel free to reach out to us. We are always here to help! # What is an NFT? ## What You Need To Know About NFTs NFTs were the talk of the town for the majority of 2021, and for a good reason; every person and their grandma were trying to profit from seeing so much hype about 1000% gains. A lot of other people were pretty confused as to what NFTs are and how a "JPEG" with some code behind it could be worth so much. We're here to help you understand exactly what NFTs are and why they're not just pixelated monkey pictures. Here's everything you need to know. ### **What Is an NFT?** So, according to the [Collins](https://www.collinsdictionary.com/dictionary/english/nft) dictionary, an NFT is "a unique digital certificate, registered in a blockchain, that is used to record the ownership of an asset such as an artwork or a collectible." So, for example. If you owned an original video file such as your wedding video, this could be digitized and created in an NFT, meaning that whichever wallet address that holds this NFT is the sole owner, and there is no other file like it in existence. Non-fungible means unique and cannot be traded like you could with a cryptocurrency. NFTs aren't exactly new either, they've been kicking around since 2014, and it's only recently that they've become a popular way to buy digital art. According to CNBC, trading volume for NFTs hit a staggering $17 billion in 2021, increasing 21,000% from the [previous year.](https://www.cnbc.com/2022/03/10/trading-in-nfts-spiked-21000percent-to-top-17-billion-in-2021-report.html#:~:text=Investing%20Club-,Trading%20in%20NFTs%20spiked%2021%2C000%25%20to%20more%20than,billion%20in%202021%2C%20report%20says\&text=Trading%20in%20nonfungible%20tokens%20hit,a%20report%20from%20Nonfungible.com.) Typically, NFTs will come as a limited batch; collections of 10,000 or 5000 are pretty standard when launching an NFT project; this essentially creates greater demand. Many people will event mint NFTs of videos or artwork that currently exist, begging the question, why would you want to buy something when you can see or own it for free by saving it to your device? The reason is that an NFT allows the investor to own the original piece of content or art; it cannot be altered and has a permanent and tamper-proof authentication built into its code which makes ownership of the NFT easier to verify. ### **How Is an NFT Different from Cryptocurrency?** An NFT stands for non-fungible, meaning that no two NFTs are the same as the code is unique and cannot be traded as you could with crypto as they're fungible, meaning that they can be traded for one another. The reason is that cryptocurrencies are equal in value, meaning that one SOL would still be the same value as another SOL. The same goes for fiat currency; one dollar equals one dollar. But, as NFTs are all unique, they aren't considered equal, even if they're from the same collection, meaning that one collection such as [Beebles Crossroad](https://www.dexerto.com/tech/top-10-most-expensive-nfts-ever-sold-1670505/#:~:text=1.,total%20cost%20of%20%2491.8m.), which sold for $6.6 million, isn't equal to [CryptoPunk #7804](https://www.dexerto.com/tech/top-10-most-expensive-nfts-ever-sold-1670505/#:~:text=1.,total%20cost%20of%20%2491.8m.), which sold for $7.6m, not because of the price but due to the unique code of each NFT. ### **How Does an NFT Work?** As we mentioned, NFTs are non-fungible and can be used as a way to verify ownership, and like cryptocurrencies, they exist on the blockchain. There are a number of blockchains that are used to host NFTs, but the two most popular are Ethereum and Solana. Although, within the past year, Solana has quickly become the rising star of the NFT community, with many expecting it to overtake Ethereum as being the lead network for hosting NFTs. The reason why is because the Solana transaction speed and gas fees are significantly cheaper and faster than their Ethereum counterparts. At the time of writing, the [Ethereum gas fees](https://crypto.com/defi/dashboard/gas-fees) are roughly 0.3% of the transaction; gas fees are basically the fee you pay to make the transaction happen. In contrast, Solana gas fees are $0.0000000000001 for every transaction. You can see why Solana is becoming more popular. The benefit of NFTs is that you don't need to just mint digital items; you can mint NFTs for physical items, too; this includes: * Art\\ * GIFs * Videos and sports highlights * Collectibles * Virtual avatars and video game skins * Designer sneakers * Music * Homes * Legal documents NFTs are just digital collector's items, and like physical collector's items, people get obsessed with owning them all or ones with rarity. Many NFT collections also have something called utility, which means that if you buy the NFT, you'll be entitled to various perks such as in-person events, private members' clubs, or something as simple as free merch. ### **What Are NFTs Used For?** NFTs are a great way for artists and creators to make money from the blockchain hype and to ensure that their work isn't cloned and sold fraudulently. NFTs are also great for verifying proof of ownership; for example, the real estate platform Propy has recently listed two homes that are backed by NFTs to prove the concept that you can store all of the housing data, transaction information, and legal documentation within an NFT which completely removes the risk of fraud, money laundering, and expensive fees in order to buy or sell a property. If you're a creator selling your work in a traditional sense, it's pretty time-consuming and expensive to rely on galleries and auction houses to sell their art. Instead, With NFTs, you simply just mint the NFT on a marketplace, pay a small fee and then market their work to social media, and the NFT community is always looking for new pieces to invest in. Selling directly to the investor means more money goes into their pockets than those of the galleries and auction houses. Not only that, but whenever an NFT is sold to another buyer, the original artist will receive royalty payments for each following transaction. Which in the physical world doesn't really happen. ### **How to Buy NFTs** If you want to buy an NFT, you'll first need a wallet. You can find our step-by-step Phantom wallet setup guide in [How To Set Up Your Phantom Wallet](/faq-and-guides/crypto-guides/how-to-set-up-your-phantom-wallet). You'll also need to fund your wallet with some cryptocurrency; if you're using a Solana NFT marketplace like MagicEden, get some SOL and if it's an Ethereum marketplace like OpenSea, have some ETH, which can be bought on an exchange such as Binance or Coinbase. ### **Popular NFT Marketplaces** There are literally dozens of Marketplaces to choose from; these are just a few of the popular options from various blockchains. #### OpenSea OpenSea holds the title of the world's first and largest NFT marketplace and has an impressive collection of listings from the world's most famous NFT projects. OpenSea operates on the Polygon network. #### MagicEden MagicEden is a Solana-based NFT marketplace that is reportedly the largest in the game for SOL NFTs. It rose to popularity as more people realized that Solana NFTs are significantly cheaper to mint than Ethereum NFTs. Our very own Homeowners Association NFT collection was minted via MagicEden. #### Rarible The contender to OpenSea, rarible is another NFT marketplace that, at first glance, seems to be full of Pepe memes. After digging slightly deeper, you do notice that it has some quality NFT collections listed on the platform; these cool projects are often overlooked, as most Ethereum NFT enthusiasts stick to OpenSea, so there are some good buys. It's important not to think too much about what to buy. To begin your journey of buying NFTs, just focus on projects that provide you with an initial reaction of "oh, that looks cool" chances are that if you think that, there will be thousands of others that think the same. # What is a Smart Contract? Whether you're just getting into crypto, or are a seasoned "OG", chances are high you've come across the term "smart contract." Smart contracts play an incredibly important role in blockchain technology and crypto as a whole. In this guide, we'll cover everything you need to know about what a smart contract is, and why smart contracts play a critical role in the further adoption of cryptocurrency. ### What is a smart contract? An inside look at the blockchain technology Smart contracts are simply code stored on the blockchain that run when certain conditions occur. In general, the code is open and transparent, and functions without the need of approval from any additional party. Smart contracts can automate and verify a wide variety of tasks and functions, and help "decentralize" everything from finance, and to insurance, and more. Smart contracts were first proposed in the early 1990s by Nick Szabo, who coined the term and continued play an essential role in crypto today. Essentially, you can write a protocol (smart contract) that'll execute an agreement or verify a piece of information without needing a third party like a lawyer or mediator. By removing this third party, you actually increase levels of safety, security, and non-bias from an agreement; this is because smart contracts are trackable and irreversible and contain all of the information and terms of the agreement and execute all envisaged actions automatically. Smart contracts currently operate on every major blockchain network multiple different including Solana, Ethereum, and Cardano. Smart contracts are important because they remove centralized middlemen in contexts that require trusted third parties to help facilitate value transfer. ### How do smart contracts work? Smart contracts are built from code that will automatically execute an order once the parameters of the agreement have been met. The terms of the contract are agreed upon by both parties involved in the transaction.‍ Essentially, the smart contracts work exactly how they are coded. In theory, there are no secrets or exceptions. Once the terms have been agreed upon, the instructions are then written into code. The code will consist of various conditional statements that will account for any possible scenario and how the smart contract should operate if this particular scenario happens. The code is stored and passed around the blockchain network, with all computers of the network now able to execute the code. ### **6 benefits of smart contracts** #### 1. **Cost and time saver** By removing the middleman and large intermediaries from a process, you'll significantly reduce costs, and the transaction or process itself will become faster and more simplified over the long run. Smart contracts can help reduce admin and labor costs, making transactions and processes cheaper and easier for people and businesses. Because smart contracts are fully automated and transparent, there's less need for 3rd parties to step in. An agreement made through a smart contract is set in stone. There is very little grey area. When X occurs, Y will occur shortly thereafter. #### **2. Innovative security applications** In general, once you write the code of a smart contract, it cannot be tampered with; it will work in the way they are intended to and cannot be hijacked. The only issue is that you need to ensure that the code that you write is accurate with zero bugs. Carrying out transactions between multiple parties doesn't require you to trust the other party because the smart contract code deterministically enforces the rules of the contract. You can imagine the applications for this. For example, if your insurance policy is run through the blockchain, you can have a smart contract guarantee a certain amount of money if you were to get in a car accident. ‍ Nonetheless, security is still a concern because the *logic* of a smart contract could be incorrect. This is why it is typical for smart contracts to be carefully audited by security experts before deployment onto the blockchain. If the contract's logic is correct, then its code can execute trustlessly, and the results of any execution will be verifiable and immutable.‍ #### **3. Transparency and Reliability** Thanks to smart contract technology, all transactions are stored on the blockchain. Therefore, every transaction made is completely transparent and can be verified. No one can tamper with the data stored on the contract, which makes them more reliable than traditional paper or spreadsheet records. Not only that, but both parties will work to write the smart contract, meaning that there will be no room for backtracking or not fulfilling their side of the agreement.‍ #### **4. Safe storage** Smart contracts store vital data that in the event of a data loss on other systems, the data held on the smart contract can be retrieved as all information is permanently stored on a blockchain. Because many blockchains utilize computer networks from all around the world, there's no single point of failure. A fire in a massive server room for example, would not affect a blockchain network designed for global access. #### **5. Certainty of transaction** Smart contracts operate by code; if the pre-agreed criteria are met, the smart contract will execute with zero hesitation. There will be no chance whatsoever of fraud, hesitation, or backtracking. #### **6. Autonomous** Automation is most certainly the most significant advantage of using smart contracts. The contract executes on its own and with zero need for human intervention. No other action is required once the code is written and terms are agreed upon. Businesses will be able to automate several aspects of their operation, resolve trust issues and reduce costs within business processes. ### **6 Smart contract use cases and examples**
#### **1. Travel Insurance** If you are going on vacation and take out flight insurance using a smart contract, and your flight got canceled, that contract could be executed to determine if your claim should be paid out. Since your flight was canceled, and this is easy to prove, the smart contract would likely pay out your claim immediately. Suppose you take out an insurance policy using a current-day insurance company. In that case, the insurance company would evaluate your claim and can decide whether or not to pay you or begin some sort of investigative process that consumes time and resources.‍ Insurance claims can take weeks and sometimes months to close; smart contracts can help reduce this typically lengthy and cumbersome process. #### **2. Mortgages** Another example of how smart contracts can be used in the real world is in the approval of mortgages. If you are a homeowner or broker, you know better than anyone that mortgages can take up to two months to approve.‍ Smart contracts can significantly reduce this time to just a few days if the person seeking the mortgage has all the relevant information and meets the parameters of a smart contract that writes mortgages. #### **3. Healthcare** By using smart contracts in the healthcare sector, you could store patients' health records on a private or hybrid blockchain. Smart contracts could help to scour millions of records to perform analysis of patient information to make a hospital more efficient or to ensure the smooth running of the internal supply chain. If the health sector adopts technology such as health bracelets, it will register all of your information such as blood pressure and heart rate. This vital information could then be communicated to healthcare professionals using a smart contract to provide a live data feed; if any of the health parameters cross, the relevant people can receive a notification. The smart contract will notify you, your family, and a healthcare professional about your current state of health; it could even go as far as ordering your medication. #### **4. Supply chain management** Paper-based supply chain management can be a complete disaster. The bureaucracy of gaining approval, and the tedious task of tracking, increase the chances of fraud, loss of materials, and costly mistakes. For example, HomeDepot currently uses blockchain technology to help resolve disputes with its vendors. Smart contracts can help manage the inventory and automate payment and tasks. Warehouse managers will be able to see real-time stock levels and an accurate understanding of how long it'll take to restock. This will, in turn, improve delivery times thanks to smart contract data that can be collected and analyzed. Clear records of when items are most popular will allow businesses to plan ahead, avoiding overstocking and tying up money in products they won't sell. #### **5. Digital identity** If you, for some reason, have to verify your identity or somewhat private details of your life to an institution, you can completely streamline the process by storing your job, bank, and demographic details on the blockchain.‍ And by using a smart contract, this information can be shared with any person or entity you wish; it can be pulled from the blockchain instantly. The KYC (know your customer) process will be instantaneous. A benefit of this is that you can control which information you share, meaning you're in control of your own information.‍ #### **6. Get real estate exposure with Homebase** Homebase uses Solana smart contracts across its real estate investment platform. Each home on the Homebase platform is represented via a collection of tokens which you can invest into in exchange for USDC on Solana. The asset transfer is regulated by Homebase policy and securities guidance, and the transfer itself is facilitated by a Homebase escrow contract. Similarly, Homebase rent distributions are completed via smart contracts that act as distribution channels when certain requirements are fulfilled. This allows the team at Homebase to easily distribute proportional net rent to co-owners each month. Smart contracts may have a ways to go before being used in by everyone in every day life, but the potential is going to transform the way we interact, do business, buy real estate, and more faster than most think. # 5 tips to keep your crypto safe and secure As interest in cryptocurrency continues to grow, so does the importance of knowing how to keep your crypto safe. Unlike with traditional banking where you can reset your password in just a few clicks or call your credit card company to report a fraudulent charge, the stakes with crypto by design, are a little bit higher. Whether you’re looking to invest a few extra dollars into crypto or plan to allocate a large portion of your portfolio, taking crypto security seriously is a must. Here are 5 tips to help keep your crypto safe and secure. ### 1. Invest in a crypto hardware wallet If you were to follow just one tip on this list, investing in a crypto hardware wallet is a great place to start. For less than $100 you can dramatically reduce your chances of being hacked or having your funds stolen. A crypto hardware wallet adds an added layer of security and protection to help use your crypto safely online. Essentially, a hardware wallet puts your funds into a “cold wallet” or “cold storage” when not in use, where it’s incredibly difficult (if not impossible) to hack. When you use your hardware wallet online, you have the added protection of having to enter your password when interacting with smart contracts ([What is a Smart Contract?](/faq-and-guides/crypto-guides/what-is-a-smart-contract)) and other provided other app permissions needed to navigate the world of decentralized finance and crypto. While it’s common for many crypto users to hold their crypto in an online wallet only, this puts your funds at serious risk. A hardware wallet is an incredibly effective way to prevent most security threats when using crypto. The most common hardware wallet brands are [Ledger](https://www.ledger.com/) and [Trezor](https://trezor.io/). Both are industry leading in terms of UI/UX as well as security. Ledger works with Solana, Ethereum, and hundreds of other cryptocurrencies as does Trezor. As of this writing Trezor does not have Solana compatibility. If you really want to go for ultimate security, you can purchase a fireproof steel coating where you can safely store your seed phrases offline. ### 2. Watch out for phishing Shady links in emails and online have existed since the Internet began, but it’s especially important to be extra vigilant about links, documents, and other downloads when you hold crypto. According to [some estimates](https://www.antivirusguide.com/cybersecurity/phishing-statistics/), one in every 100 emails are designed to steal your data or login information. Phishing attempts continue to become more sophisticated which makes it essential to only click links you 100% trust. In most cases, going to the homepage of the official website is the best way to go. Furthermore, if you spend time on Discord, Telegram, or Twitter, always make sure for certain you’re talking to the real person. Avoid entering "too good to be true" contests that promise rags to riches. Scammers know exactly how to get you emotionally invested, so ignore 'urgent' requests for money or assistance. If something looks fishy, it probably is! Phishing is one of the most common ways for bad actors to get access to your funds, so remain vigilant at all times. Again, never reveal your private key to anyone! ### 3. Not your keys, not your funds Another important safety tip to remember: your private keys are what determines who owns the contents of a wallet. Never, share your private keys or seed phrase, especially online or via email. If someone has your seed phrase, they have complete and unblocked access to all your funds. Whether you're setting up your Solana or Ethereum wallet, always be sure to write down your seed phrase and store them in a secure location (a physical safe for example.) And again, never share them with anyone. More importantly, never send them over text message, in email, or even store them on your computer. Which brings us to exchanges. Holding cryptocurrency on an exchange technically means they aren't your funds. While the vast majority of exchanges operate in good faith, it's important to remember you're technically at the mercy of the exchange if something disastrous were to happen to the exchange. Unlike with money in the bank, most exchanges don't ensure your funds. This isn't to scare you or discourage you from using exchanges, but it's an important reminder that unless you have the private keys yourself they aren't your funds. While many crypto users are comfortable holding small amounts of crypto on an exchange, it's always a good idea to move most of, if not all your funds, offline and to a hardware wallet. ### 4. Use 2FA and check your permissions often Although a little more technical than some of the tips shared above, using two-factor authorization is yet another step you can to take to improve the security of your cryptocurrency holdings. 2FA or Two-Factor Authentication, requires multiple touchpoints for any transaction. So for example, to send Solana to another individual, you would need to confirm via email and through a 2FA tool such as [Google Authenticator](https://safety.google/authentication/) or [Authy](https://authy.com/). These unique codes are updated every 30 seconds, so it's virtually impossible for a hacker to break in. Though it is an extra step when doing day to day crypto transactions, the peace of mind it brings is well worth the extra couple of minutes. Many of the most popular exchanges today require 2FA to be turned on by default, and for good reason! In general, it's recommended to **not use** text message as part of the 2FA process, as bad actors have been able to social engineer phone companies to provide the needed codes. In addition to turning on 2FA, it's good practice to periodically review connected sites via your wallet of choice. While interacting with dozens of protocols and smart contracts is common in the world of crypto using an online wallet such as MetaMask, or Phantom, the more sites you connect to the higher the risk. Set a reminder to review permissions on a regular basis. It's very important to only connect to sites you trust and periodically disconnect all connections to help reduce the chance of a vulnerability affecting you. If you notice you're connected to a site you don't recall visiting, disconnect and consider moving your funds to a fresh wallet immediately. ### 5. Use a password manager While there is some debate as to whether you should store your seed phrase on a password manager, the reality is, having strong passwords is going to significantly reduce the chances of a bad actor logging into your email, computer, and more. Strong passwords are critical for staying safe online, regardless as to whether you choose to store seed phrase in the password manager. Thanks to the likes of [1Password](https://1password.com/) and [LastPass](https://www.lastpass.com/), you can generate incredibly secure passwords and not have to remember a 100 character password. Even if you're not super invested in crypto, a password manager can be a great way to level up your security. That said, a password manager doesn't mean you should lax on some of the other suggestions above. While there are many more ways to keep your crypto safe and secure, by taking action on the above suggestions, you'll be in a much better position than you were before. **Editor's Note:** Buying, trading, and transferring cryptocurrency is a risky endeavor. Never invest more than you can lose, and always take the proper security measures to keep your crypto safe and secure. This post is for educational purposes only.