Founded by Mindy Ngo and Tom Sigler, The LendingCoin is the first blockchain-powered commercial real estate funding platform, aiming to expedite transactions and reduce fees without compromising security and transparency. On June 19th, 2018, TLC solidified a prominent and historic position in the finance and blockchain world by being the first to finance a commercial real estate property using blockchain technology. It was the first-ever blockchain-recorded lending transaction with a cryptocurrency that is backed by real estate. Since monthly payments are recorded and tracked on the blockchain, transparency and security are enabled for both borrowers and investors. We were able to catch Mindy and ask her a few questions about how TLC got to where it is today, and where it’s headed in the future.
BitIRA: How did The LendingCoin come to exist?
TLC: The company was created in 2017 after the founders experienced frustration in the heavily regulated, costly, and archaic commercial real estate loan process. TLC has solved these dilemmas by creating a world-wide lending platform utilizing state of the art blockchain technology to benefit both borrowers and investors. The LendingCoin (TLC) is the brainchild of an amazing team of seasoned professionals who envisioned a solution to provide accessibility to real estate investments. TLC enables transparency through blockchain technology while maintaining liquidity as a cryptocurrency. The TLC model is peer-to-peer lending around the world. Peer-to-peer lending is an innovative approach to allowing borrowers faster access to funds while bolstering profitability for investors. Trust in banks is decreasing while blockchain technology enables transparency and trust on an immutable ledger. Providing trust alongside anonymity creates a superb unique value.
BitIRA: You acknowledge the voice of the crypto skeptics. What did it take for you to overcome any initial skepticism you had around cryptocurrency and blockchain?
TLC: The basis of overcoming initial skepticism is explaining use cases that major corporations are applying Blockchain or even issue their own cryptocurrency. What began as the basis for cryptocurrencies, i.e. Bitcoin and Ethereum, blockchain technology is going beyond virtual fiat and impacting across industries from banking to healthcare. According to IDC, businesses are expected to spend $2.9B on blockchain development and applications, up nearly 90% from last year. Gartner Group stated Blockchain will reach a $3 trillion-dollar industry by 2020.
Earlier this year, a major U.S. bank, JP Morgan announced plans to launch JPM Coin, which will be used to settle payments between clients and lender cross-border. Instead of relying on old technology like wire transfers, JPM Coin will expedite the process through smart contracts.
In June, Facebook announced Libra, a cryptocurrency that will make sending money online cheaper and faster, thus improving financial services particularly for those with limited banking access. Libra has 25 partners, ranging from payment processing to ride-share industries. Investment is open to major corporations and VC firms with a $10M minimum. Users do not benefit from price volatility as it is intended to be a stablecoin, meaning its value is pegged on another currency, which in this case is the U.S. dollar. $1 worth of Libra is spent as $1 on a different platform.
BitIRA: What are the current limitations The Lending Coin faces in terms of adoption and usage? What seems to be most successful way to handle them?
TLC: Our major barrier to entry is lack of discretionary capital for lending. TLC is positioned as the only asset-back commercial real estate blockchain lender with a liquid and flexible digital security component for its investors. TLC’s allows investors limited market exposure in commercial real estate due to diverse portfolio and liquidity through selling digital securities on secondary exchanges. Utilize key market partners to purchase performing loan portfolios and originate low leverage loans. Our critical success factor is available capital to execute loan portfolio purchases and loan originations.
BitIRA: In which directions do you see The Lending Coin growing over the next ten years?
TLC: The Company anticipates to finance $100M of real estate properties by the fourth quarter of 2019 once capital is raised. TLC intends to offer liquidity for TLC tokens through eventual open trading on global and U.S. exchanges. This will enable potential return on equity after one-year hold for investors. We look forward to establishing more international presence and pooled portfolios to be sold on secondary markets. TLC will target strategic partnerships for further growth and innovation. The Company will eventually identify and engage in alternative collateral assets in order to diversify our lending portfolio and facilitate growth. TLC has a patent pending on our blockchain lending platform that we could potentially license for revenue as SaaS or LaaS (lending as a service) to lending institutions.
By 2023, the Company anticipates identifying merger and acquisition targets along with being a possible candidate for exit through acquisition by banks, CRE, or REIT.