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The cost-of-living crisis has persisted longer than many anticipated. Despite global inflation nearing typical levels, individuals are still grappling with rising costs while wages lag. So, how are people getting creative to earn supplemental income during these challenging times?

For years, Airbnb has provided individuals with an alternative means of earning extra income by renting out their homes or spare rooms. Founded in the wake of the 2008 financial crisis, Airbnb has grown significantly, expanding its presence to over 100,000 cities worldwide and hosting millions of guests annually. However, this success has also brought challenges, particularly in regulating the short-term rental sector effectively.

Many cities are concerned about the displacement of long-term rental housing and the maintenance of residential integrity in favor of the tourist market. As a result, governments have experimented with various regulations to strike a balance. For instance, Dallas has restricted vacation properties in specific residential neighborhoods, while cities like San Francisco and Seattle have limited the number of properties a host can manage. Some locales have imposed limits on the number of nights a property can be rented out annually, while others, such as New York and Tokyo, require hosts to reside in the rental property.

Despite these regulatory challenges, the flexibility offered by platforms like Airbnb remains a compelling draw for real estate owners. Financially, hosting on such platforms offers potential supplemental income without the commitment of long-term rental agreements. In 2022 alone, hosts in the United States collectively earned $22 billion by welcoming travelers into their homes.

But what happens if plans are disrupted by regulatory mandates, resulting in the loss of this investment opportunity? As Airbnb continues to face tightening regulations, investors may pivot and explore alternative avenues for investment opportunities. For instance, tokenized real-world assets (RWAs) have emerged as a potential alternative, even attracting the attention of traditional institutional players.

Tokenizing real estate has opened new opportunities for prospective investors, reshaping public perception and interactions with digital assets. FreeBnk, a fintech app, aims to unite web2 and web3 banking on one platform. Part of its mission is to make crypto more accessible by allowing users to invest in fractional RWAs. This enables retail investors to access a wide range of properties with smaller capital commitments, mitigating traditional entry barriers in real estate investing.

Instead of spending on a new household gadget, FreeBnk allows users to allocate those funds towards browsing and potentially investing in a property. The interface operates similarly to Airbnb, but instead of booking a vacation, users can assess a potential investment property based on their financial objectives and then put funds toward its fractional ownership. Users earn rental income, with FreeBnk managing the real estate properties, collecting the rent, and depositing the money directly into the user’s account.

Making real estate more accessible allows a new class of investors to diversify their portfolios. As the real estate market expands, investors from all backgrounds can benefit from the long-term appreciation of tangible assets. RWAs present an opportunity to create an inclusive market where financial growth potential is shared, and economic prosperity is driven by many participants rather than a select few.

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