$REY Token (Real Estate Yield Note)
$REY (Real Estate Yield Note) is a blockchain-issued yield note, backed by a pool of future rental receivables across multiple properties. It is collateralized with receivable registrations and $A_20 Property IDs, and distributes periodic interest via on-chain yield contracts.
Key points:
Debt-like Instrument, not Equity — $REY does not represent property ownership; it entitles holders to pro-rata claims on future cash flows.
Multi-Property Collateral — Rental receivables and protocol-held $A_20 tokens are pledged as security.
On-Chain Settlement — Coupons are distributed periodically on-chain, ensuring transparency and auditability.
Capital Interfaces — $REY can be used in collateralized lending, secondary trading, or stablecoin-backed credit.
Comparable to REITs, $REY offers low-volatility, stable yields, but with blockchain-native advantages: transparency, borderless accessibility, and composability.
Collateral & Legal Structure
Collateral Pool Composition:
Dubai-registered receivables with enforceable pledge rights.
Locked $A_20 Property IDs held by the $REY protocol.
Security Mechanics:
Cash flows → escrow account → first allocated to $REY principal & coupon.
IC/OC (Interest Coverage / Over-Collateralization) and pool-level DSCR enforced.
Defaults trigger liquidation of pledged $A_20 tokens or use of reserves.
Legal & Regulatory:
Dubai — Property operations and receivable pledges registered for judicial enforceability.
Hong Kong — Issuance & trading compliant with SFC/HKMA frameworks, under KYC/AML whitelist transfer controls.
Key Features
24/7 Minting & Redemption — Within compliance limits, settled at current NAV/face value.
Low Entry Barriers — Open to qualified retail and institutional investors.
Stable Yield — Rental-backed coupons targeting long-term 6–9% annualized range (subject to disclosure).
Pool-Level Risk Controls — Triple thresholds (IC/OC/DSCR), dual audits (operational + contractual).
Composable — Eligible for collateral in DSCR lending, market making, and derivatives hedging.
How It Works (Mint / Redeem)
Minting:
Investors deposit $A_20 tokens or USDC.
Protocol validates compliance and valuation (DCF/snapshot).
Contract mints $REY at NAV/face value to the investor’s wallet.
Investor gains pro-rata claims on the collateral pool.
Redemption:
Investor submits redemption request.
Contract burns $REY and returns USDC / $A_20 tokens (subject to pool liquidity & disclosure rules).
Oversized redemptions enter a delayed settlement channel.
Pricing & NAV
Valuation Basis — DCF of future net cash flows, adjusted for operations, fees, reserves.
Oracle Updates — NAV published on-chain at disclosed intervals (daily/weekly/bi-weekly/month-end).
Distribution Waterfall
Tenants → Escrow Account (on-chain recorded).
Deduction of operating costs, taxes, insurance.
Allocation to reserves and servicing fees.
Distribution of coupon payments (pro-rata snapshots).
Residuals allocated to buybacks or reinvestment.
Mechanically, rental income is first allocated to $A_20 holders; since the $REY protocol holds $A_20 tokens, proceeds flow through the protocol and are redistributed to $REY holders. Rights remain identical; only the abstraction layer changes.
Investor Experience
Subscription — Invest via USDC or collateralize $A_20 tokens to mint $REY.
Holding — Receive coupons periodically (REY-A price appreciation / rREY compounding).
Exit — Redeem at NAV or trade $REY on secondary markets.
Extensions — Use $REY as collateral for DSCR loans, stablecoins, or derivatives.
Risk Disclosure (Summary)
Cash Flow Volatility — Vacancy, defaults, or higher maintenance costs impact yields.
Legal & Regulatory Risks — Cross-border regulations and taxation require continuous compliance updates.
Liquidity Risks — Extreme events may trigger delayed redemption windows.
Model Risks — DCF assumptions may diverge from realized performance.
Mitigations: Dubai receivable pledges + HK compliance issuance; pool-level IC/OC/DSCR enforcement; reserves & market-making buffers.
Executive Takeaway
$REY offers stable, rental-backed yields with on-chain transparency and global accessibility. Its structure bridges traditional securitized debt with blockchain-native liquidity, giving investors a compliant, composable, and yield-generating digital instrument.
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