An ambitious and unusual plan involving Blockchain falls through.
As Bernard Ivezic/Poslovni Dnevnik writes on the 18th of September, 2018, Croatia’s Gamma Rustica Villa is no longer receiving reservations via Booking.com, and the project manager is returning money to investors.
Xaurum Gamma, the first construction and tourism project in Croatia to use Initial Coin Offering (ICO) as a way of collecting capital, didn’t work. Villa Rustica or Gama Rustica, as it’s called on Booking.com, a luxurious villa with a pool and a jacuzzi located in Linardići on the island of Krk, is now for sale.
The project manager, the Auresco institute from Ljubljana, Slovenia, which operates in the Republic of Croatia through Gama Construction Company, published on their website that this project’s investors will have the full amount of their invested cash returned to them.
“After careful consideration, we decided to halt the entire Xaurum Gamma (X-Gamma) project, we currently see this as the only logical and realistic option to prevent potential damage to investors, and for their money to remain intact,” the project managers have stated.
Investors in the ambitious project were mostly Slovenian citizens, and according to the available data on the matter, as many as 95 percent of them are Slovenes.
Although the original information, which was published by the Auresco Institute on its website, stated that through ICO, a 2.06 million euro capital was collected, it seems that in the meantime this amount fell to the one million euro mark.
For the project to succeed, at least five million euro in initial capital was needed. Xaurum Gamma was conceived as a complex of six luxury villas that would be based on blockchain.
”They should have had a separate blockchain address through which investors could keep track of all of the rental transactions,” said Jakob Kapus from the Auresco.
Villa Gamma Rustica, the first of the six villas, was completed last year and was immediately put into operation. It was also placed for rent through Booking.com. However, it has now been stated that reservations for this facility will no longer be received.
The project was legally regulated in quite an unusual manner. It was, as mentioned already, headed by the Slovenian Auresco Institute, and their business operation in Croatia was run through the “Gama Construction” company, and the plan was for the villas, once ready, to be managed under the company Gamma Trust, headquartered in Liechtenstein.
On the project’s website, two villas could be seen in the construction process, but the project leader has now confirmed that the project was halted in April this year because money was being lost.
Click here for the original article by Bernard Ivezic for Poslovni Dnevnik
