Fund Places, a Singapore-based property tech startup, and Malaysian property developer Hatten Land have announced a joint venture that will create what they claim to be the first hospitality blockchain platform in Southeast Asia.
Called StayCay, the platform will issue two variations of utility tokens. The first kind can be used to purchase hotel packages from Malacca-headquartered Hatten Land and its parent company, Hatten Group. The other type will be distributed as reward tokens under a loyalty program for hotel guests and shoppers across the group’s retail stores, food and beverage outlets, as well as hospitality and wellness venues.
The joint venture will see Hatten Land take an 85 percent stake while FindPlaces will get 15 per cent.
Expected to go live by December this year, StayCay will integrate more than 3,400 hotel rooms and 5,000 retail outlets in Malacca that are owned and operated by the property group.
The rewards program will be available on the web and via phone, and will work similarly to other programs. It will run on FundPlace’s blockchain technology, which was created two years ago.
Benefits and risks
The use of blockchain helps customers to better track their rewards from transactions across various properties in Hatten’s portfolio. In contrast, customer data in legacy systems may not be consistently updated.
Selling hotel packages in exchange for tokens will also allow the property developers to collect revenues upfront, even before clients use them. And because blockchain leaves a unique record in the system, transactions cannot be replicated or faked.
The technology also allows the Hatten Group to perform seamless cross-border transactions.
“An effective distributed ledger will enhance hotel booking efficiency, and make the guest booking process and reservation management much more streamlined,” said John DeCleene, associate fund manager at investment firm OCIM. “It also allows for faster overseas settlement of payments, which can cause major delays for multinational hotels that transact in multiple countries.”
But DeCleene noted that storing customer data and protecting their privacy would be important. The companies will have to ensure that the blockchain platform is extremely secure and not vulnerable to an attack.
“We will make sure that all the processes and onboarding of StayCay will be compliant with antimony laundering and know-your-customer laws from all countries. We have to make sure that it is safe, and that is an essential component in building the project,” said Tan Kok Keong, FundPlaces’ chief operating officer and co-founder.
Last year, it launched a real-estate backed cryptocurrency called Tiles, which entitles each holder to the cash flow of the underlying property.
But that caught the eye of the Monetary Authority of Singapore (MAS), prompting the central bank to issue a warning about how such cryptocurrencies may be used for criminal activity.
MAS also issued a guide months later, noting that if a particular cryptocoin is seen as capital market product under the Securities Futures Act, the coin offer may be regulated. Part of the regulation is requiring the crypto company to obtain a license from the central bank.
Tan told Tech in Asia the company is in the process of getting the license.