Financial Applications Layer
With tokenization and abstraction complete, real estate assets gain the fundamental capability for global circulation and financialization. Yet for both investors and property owners, the true value lies in unlocking liquidity, reducing financing costs, and enabling diversified asset allocation.
The Financial Applications Layer represents the top tier of NeoMason’s architecture. Its objectives are:
To make $REY not only a yield-bearing certificate but also a core collateral asset in financial markets.
To provide investors with a diverse suite of financial tools, including lending, stablecoins, secondary trading, and derivatives.
To serve as the bridge between real estate finance and decentralized finance (DeFi).
Key application scenarios include:
Collateralized Lending — DSCR-based loans backed by rental income, without forced liquidation.
Stablecoin Issuance — Stable assets pegged to $REY-backed cash flows.
Secondary Market Trading — Free exchange of $REY to enhance liquidity.
Derivatives — Structured products, yield swaps, and risk management tools built on $REY.
DSCR Lending Protocol: Collateralized Lending without Liquidation Risk
Operating Logic
In the NeoMason DSCR Lending Market, investors can deposit $REY to borrow USDC:
Borrower deposits $REY as collateral into the lending protocol.
Liquidity pool provides USDC to the borrower.
Repayment mechanism: Loan principal and interest are automatically serviced via rental income streams represented by $REY.
DSCR constraint: Loan amounts are capped based on the Debt Service Coverage Ratio, ensuring debt obligations remain below property rental income.
This structure eliminates the need for forced liquidation. Even if borrowers fail to repay manually, loan servicing continues automatically via ongoing rental flows.
Key Advantages
Purpose-built financing for rental properties
Loans tied directly to $REY’s cash flow.
Principal + interest < rental income.
Ensures sustainable and long-term lending safety.
Automated repayment, no liquidation risk
Rental proceeds automatically routed to loan repayment.
Shortfalls are gradually covered by ongoing cash flows.
Borrowers avoid forced liquidations and associated losses.
Enhanced returns for lenders
100% of collateral rental income flows to lenders.
Lenders receive both fixed yields and governance token incentives.
Dual return: stable cash flow + upside rewards.
DSCR Calculation and Constraints
Definition
Where:
NOI (Net Operating Income) = Rental income – operating expenses (property management, maintenance, insurance, taxes, etc.).
Debt Service = Principal amortization + interest due.
Calculation Methodology
Based on net rental income (NOI), unlike banks that often use gross rent.
Calculated on a rolling monthly/quarterly basis.
On-chain snapshots ensure transparency and auditable records.
Constraint Framework
Minimum DSCR = 1.1x baseline.
Dynamic thresholds by loan tenor:
1-year loan: DSCR ≥ 1.1
3-year loan: DSCR ≥ 1.5
5-year loan: DSCR ≥ 2.0
Comparison with Traditional Finance
Banks typically require DSCR ≥ 1.2, but calculated on gross rent, ignoring operating costs.
NeoMason uses NOI-based DSCR, offering a more conservative and transparent standard aligned with real cash flows.
Stablecoin and Liquidity Applications
With $REY as a stable cash-flow-backed instrument, NeoMason can issue real estate–backed stablecoins (e.g., rUSD).
Investors deposit $REY into the protocol.
Stablecoins are minted, pegged to USD and collateralized by $REY’s discounted rental cash flows.
Stablecoins serve as low-volatility, high-credibility collateral in DeFi, suitable for settlement, hedging, and cross-border transactions.
This design directly channels real estate income into the stablecoin ecosystem, providing a trustworthy alternative to crypto-volatility-backed stablecoins.
Secondary Market Trading
$REY is designed as a globally tradable note, enabling seamless liquidity:
Direct exit — Investors sell $REY on secondary markets.
Partial liquidity — Investors sell part of holdings while retaining residual yields.
DEX liquidity pairs — Integration with protocols such as Uniswap allows real-time pricing and efficient exits.
Derivatives and Extended Applications
As adoption grows, $REY can underpin a range of derivative and structured instruments:
Yield Swaps — Exchange fixed vs. floating rental yields.
Hedging Instruments — Risk management products tied to occupancy or rent volatility.
Structured Products — Layered return products tailored to institutional investors.
These extensions integrate real estate not only into traditional REIT frameworks, but also into global DeFi markets, unlocking broader capital market potential.
Executive Takeaway
The Financial Applications Layer makes $REY the gateway asset bridging real estate and DeFi. By enabling DSCR-based lending, stablecoin issuance, secondary trading, and derivative markets, NeoMason transforms real estate from a static asset into a liquid, collateralizable, and composable cornerstone of Real Estate Finance 3.0.
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