BukTrips is tokenizing hotel room bookings, making them tradable and resellable. Imagine Expedia+OpenSea, where Expedia provides hotel booking experience, while OpenSea provides NFT trading experience. You can now trade bookings of hotel room reservations for F1 races or Taylor Swift concert and make a secondary market around it. BukTrips.com is LIVE and already partnered with likes of Expedia, Priceline and more with inventory from Marriott, Hilton and many more properties globally available for trading.
Long form explanation
Real-world asset tokenization (RWA) is the process of converting real-world assets into digital tokens that can be traded on a blockchain. This has the potential to change the way multiple businesses today operate, right from securities to currency, to physical assets to real estate. In most cases they add liquidity to an existing market and expand access to the underlying asset class.
While providing immense opportunity, they do suffer from lack of regulatory clarity and often represent underlying assets which are illiquid and difficult to move(Example real estate, land, etc.). All of this with low yields of 2% - 25% annually, in majority of the cases.
Introducing RWA for Time sensitive industries. Time sensitive industries here represent industries who are backed by assets(or services) which lose their value after a specific point in time, like an expiry date. Example: a hotel room booking, loses its value after the checkout date; A flight ticket loses its value after the flight has departed. Examples of time sensitive industries include - Travel, HOspitliaty, Events, Shipping & Logistics, restaurant reservations and many more.
Buk is the industry vertical protocol focusing on tokenization for Time -sensitive industries. With initial focus on the Travel industry, and specifically in the hospitality industry, Buk intends to be the protocol for tokenization of hotel room bookings (not real estate hotel investment or time share). In comparison to RWA for physical assets, hotel room bookings are governed by industry norms driven by private entities (Hotel groups, OTAs, travel agency federations and tourism boards). This eliminates the quagmire of unclear regulations and slow decision making. With yields of 20% - 1000%, the 1 trillion USD industry has decades of data to provide predictability and price performance data. The perishable nature of these assets ensure regular inflow and outflow of investments and transactions, unlike conventional RWA, which is purchased, but stagnates due to store of value attribute of the underlying assets.
RWA also revolutionizes the travel and hospitality industry in a number of ways.
First, tokenization can create a secondary market for travel-related assets, which would increase liquidity and transparency in the industry. This would make it easier for travelers to buy and sell travel-related assets, such as hotel rooms and flights, and would also provide a more efficient way for businesses to manage these assets.
Second, tokenized distribution models can help to reduce distribution costs and improve transparency in the hospitality industry. Blockchain based transactions also bring higher control for the organizations who own the inventory(Hotels) providing them the visibility and control on pricing and distribution even beyond primary sale.
In addition to the above, tokenization can also provide travelers with more flexibility in planning and traveling. For example, travelers could use tokenized bookings and capitalise on the seamless transferability of the assets. They could transfer bookings to their friends or resell the reservations in an open marketplace. This would give travelers more control over their travel arrangements and would make it easier for them to take advantage of last-minute deals. All while giving the underlying the hotel a completely new revenue stream via trading royalties which yield 3-5% additional revenue.
Overall, RWA has the potential to revolutionize the travel and hospitality industry by making it more efficient, more transparent, more accessible to investors, and more flexible for travelers.
BUK is building this distribution protocol for tokenized hotel room bookings. With a composable architecture and open ecosystem, Buk will welcome any incumbent to connect via APIs or SDKs to utilise the tokenized inventory model. OTAs like Expedia, Booking, Traveloka can now provide “Resell with Buk” as a feature to their customers. This ensures that the tokenized hotel room bookings are sourced, distributed and sold via all existing channels. With a transaction fee based revenue model, these distribution points strengthen the ability to distribute and build a moat with the network effect that this will create. As a technical showcase Buk has already launched BukTrips.com where the tokenized inventory model is fully functional with resellability.
The win-win-win scenario that Buk can create with the industry - Consumer - Financial participant eases the road to adoption as there is a direct financial incentive.