AU2022261697A1 - Manufacturing method and system - Google Patents

Abstract

A method of manufacturing a transferable asset by acquiring starting materials including a plurality of ownership items, each ownership item being in respect of a particular residential real property. Performing a manufacturing process to generate end financial products using the starting materials, each end financial product being a tradable and/or transferable financial product. The manufacturing process includes transforming ownership items into a plurality of security items, each security item representing a fixed proportion of a value of the respective ownership item and unique expiry conditions of each respective ownership item, and creating multiple security pool items, each security pool item including single or multiple security items. Security pool items are split into a plurality of security pool fraction items, used in creating plurality of tradable and/or transferable financial products using security pool fraction items as base components.

Description

MANUFACTURING METHOD AND SYSTEM

Background of the Invention

[0001] The present invention relates to a manufacturing method and system, and in one particular example, to a manufacturing method and system for manufacturing financial products.

Description of the Prior Art

[0002] The reference in this specification to any prior publication (or information derived from it), or to any matter which is known, is not, and should not be taken as an acknowledgement or admission or any form of suggestion that the prior publication (or information derived from it) or known matter forms part of the common general knowledge in the field of endeavour to which this specification relates.

[0003] There are currently problems associated with property markets, particularly in and around the level of equity tied up in properties and the high value providing a significant barrier to entry for individuals attempting to enter the property market.

[0004] There are currently two main types of financial solutions available for homeowners that allow them to benefit from the equity accumulated in their homes. These include reverse mortgages and loan facilities, both are typically provided with a mortgage claim to the property, meaning the lender’s claim is extended over the whole of the property, irrespective of the loan size.

[0005] In the case of reverse mortgages, while there are no cash payment requirements for the duration of the mortgage, interest repayments are added to the loan principal thus increasing the debt with a cumulative effect. There is no certainty over how much equity, if any, will be left over at the expiration date, which creates a highly probable risk of the equity being fully consumed with nothing or very little left over for inheritance.

[0006] For loan facilities, loan providers usually require regular cash repayments which generally defeats the purpose of seeking cash advances in the first place. This option also creates risk of default which can result in a mortgagee sale. [0007] Other solutions that have been proposed include shared ownership (with government), which is a facility that allows a person to buy a stake in a residential property from a combination of personal savings and/or government assistance. However, this only creates a right to occupy a property for the duration of the contract, and furthermore, these offerings are typically highly restrictive in relation to income and savings. Similar issues apply in respect of shared ownership with other entities, such as investors.

[0008] For individuals wishing to enter property market as investors or first homeowners, main barriers include high property prices, considerable size of initial deposit requirements, high loan and property maintenance costs, tenancy related issues.

[0009] There are currently very limited and case specific solutions to overcome such barriers including for example family loans and second tier lending. Some limited alternative solutions such as for example, exchange traded funds, index funds, futures and other, come with significant financial and legal constraints such as for example: limited flexibility of title transfers, exposure to mortgage claims, debt exposure, limited security structures, additional legal costs associated with title transfers, absence of a defined maturity date, limited availability for small individual investors.

[0010] In US20040158515 financial instruments to protect the value of residential homes are described. A method for generation of publicly traded notes backed by ownership of single family homes to allow financial markets to provide instruments for investors and home owners to profit from price changes in the value of single family homes. A fraction of the title to the land and dwelling of many single family homes are bundled, separately from that of the traditional mortgages, creating the equivalent of mortgage -backed-securities such as Ginnie Maes, which are marketed to public investors. These securities, herein referred to as home asset value enhancement notes (HAVENs), can be used by individual homeowners as a hedge against any declines in value of their individual homes. They can also be purchased by the general public as a direct investment in the aggregate value of residential real estate. Analogous to exchange traded funds (ETFs), they can be held as long or short positions, and thus are suitable for capitalizing on long-term appreciation in residential housing, or protecting house values over short or intermediate term declines in home prices, as might be done by home builders or individual home owners who are not able to hold the real estate assets over longer periods of time. HAVENs are intended to serve purposes similar to those of commodity contracts available to producers and consumers of commodities other than houses, such as precious metals, agricultural products or livestock. HAVENs differ from traditional insurance, in that no up-front payment is necessary to secure protection; instead a portion of ownership is pledged. In addition, this greatly broadens the public participation and thus spreads the risk. Traditional insurance resources based on homeowner premiums could be overwhelmed in a depression environment, increasing the risk that the homeowner would not be covered for his losses on sale of the property.

[0011] Accordingly, this allows for hedging of home equity values for homeowners, but disadvantages homeowners by virtue of mortgage claims. Additionally, the approach does not provide an end product (tangible asset) for offer to independent third parties as funding is through financial instruments, which are contracts, i.e. ways of organising human activity and are not tangible financial products/assets, and instead is a mere subordinate security.

[0012] US20100185467 describes an approach that allows equity returns, expenses, and risk in a real estate asset to be shared dynamically between an investor and an owner of rights. In one of several computing system based embodiments, holding the real estate asset is considered to be a joint venture, contributions by the owner and the investor to the joint venture are calculated periodically, and residual accounts or payments are adjusted to balance out the venture. Some of the residual accounts may exist outside of the conventional capital structure consisting of various debt and equity interests associated with the asset.

[0013] In this approach the joint venture equity investment is used to pay off debt. Return can be in a sliding scale, and the rate is periodically reset between homeowner and equity investor, and is not therefore based on market value.

[0014] AU2008100991 describes a data processing system and method are disclosed which finds particular application to equity finance mortgages. An Overall System is formed from a Target Investment System, an Asset Origination System, an Asset Securitization System, an Asset Servicing System and an Asset Management System. Financial feedback is applied to ensure targets are achieved. Mortgages are pooled and on-sold to investors and selected for acceptance on the basis of preferences expressed by the investors. Preferably the mortgage or like financial arrangement includes provisions relating to investment construction, and criteria setting evaluation.

[0015] This approach draws on "state-dependent" real estate equity finance claims (and related variations thereof, including interest or rental yield bearing combinations) and is "mortgage insured". There is a risk of potential on-selling of financial claims through residential real estate derivatives and the arrangement provides interest or rental yield bearing combinations.

[0016] US7516099 describes a system and method for conducting a home equity sales (HES) program enables a real estate property owner to sell a partial equity ownership interest in a real estate property. This allows the property owner to sell the interest outright to an investor and receive compensation for the sale of the interest. The property interests of the property owner and the investor are both recorded in property records relating to that particular property. The property owner may sell multiple interests in the same property and an investor may also purchase these multiple interests.

[0017] In this approach, ownership stakes bundled into funds which are then traded, presenting material issues for investors, such as a high value barrier for entry (especially for small investors), significant complexity associated with investment ownership and low flexibility of trades. Homeowners are also responsible for mortgage liability over the joint ownership. The system requires annual fees, performance fees and placement commissions to homeowners and does not include fixed maturity dates, meaning participation is costly and there is no definitive release date for the investment.

[0018] US20110004570 provides a method of debt-free property purchase through a partnership or any other form of co-ownership between a lead buyer (or buyers) and an investor (or investors) where the co-ownership is a separate legal entity whose sole purpose is to own, hold and manage a given property. The lead buyer may acquire additional percentage of the co-ownership over time towards full ownership, at a cost based on the latest assessed value. The co-ownership is best setup as a separate legal entity as it facilitates management of the property and gradual transfer of ownership. The co-ownership rents the property and the lead buyer has the first right to rent it. The co-ownership recognizes profit, loss, expense and responsibility for the property and distributes revenue. Lead buyers may choose to use their revenue to grow ownership share while investors may invest it, along with sale proceeds, in new co-ownerships.

[0019] Accordingly, the approach uses co-ownership through a separate legal entity whose sole purpose is to own, hold and manage a given property.

[0020] US20060106632 provides a method and system of financing real estate ownership involving forming a title holder entity to own equity in each property, forming a pooling entity to own most of the title holding entity, the pooling entity owned by the general public directly or through equity pools, screening applicants to determine financial suitability, the title holder selling shares of a class of stock unique to a particular applicant for each property, the particular applicant having sole use and enjoyment of the property and being an owner/occupant, the sale price between 1% and 5% of market value plus underwriting fees, each applicant paying rent to the title holder entity in exchange for additional shares, the title holder entity issuing cash dividends to the general public in an amount of the rent less management fees. Each applicant's shares are held by the title holder entity as rent security.

[0021] This approach provides a method for gradual purchase of equity by homeowners and requires various conditions associated with the staged participation.

[0022] US8019677 discloses a convertible, home-equity based financial product. Example embodiments of the invention provide a home loan that can be converted into a reverse mortgage, also known as an “equity release” product. In example embodiments, the product can be set up so that there is a low or no-documentation requirement upon conversion. Conversion can be triggered upon a request from the borrower, or upon some other event. The proceeds from the conversion can be provided in many different ways, for example, as a lump sum, an investment, a line of credit, or a scheduled pay-out. The proceeds from the equity release can also be distributed so as to be used in purchasing a residence, for example, a second or vacation home.

[0023] Accordingly, this is effectively a standard reverse mortgage product.

[0024] US20040153384 provides a method comprising decomposing each of a plurality of home mortgage loans into a plurality of sub-loan level cash flows, repackaging the plurality of sub-loan level cash flows to form a plurality of financial assets backed by the plurality of sub loan level cash flows, making a determination of accounting rules that apply to the plurality of financial assets, and storing and tracking accounting data for the plurality of financial assets based at least in part on the accounting rules.

[0025] Accordingly, the approach provides creation of financial assets backed by sub-loan level cash flows.

[0026] US20060248001 provides a method for creating and selling a contract that provides equity participation to an investor in a homeowner's residential real estate property. A contract is executed between the homeowner and an originator in which the mortgage originator purchases an equity portion of the residential real estate property from the homeowner. In connection with the purchasing, the homeowner grants a lien on the homeowner's residential real estate property to the originator in order to secure a future payment obligation of the homeowner. The future payment obligation has an amount that is determined in accordance with a value of the purchased equity portion of the homeowner's residential real property at a time of the future payment. A security is created by pooling the contract with other contracts sold to a plurality of other homeowners each of whom owns at least one of a plurality of residential real estate properties, and selling the security to an institutional investor in a secondary market. The security provides that, upon a sale of each given residential real estate property, the institutional investor has a right to receive a payment corresponding to the value of the purchased equity portion of the given residential real property at the time of the sale.

[0027] Accordingly, the approach provides mortgage backed ownership stakes, with contracts pooled and sold to institutional investors as pools.

[0028] US 2019/0287195 describes a method for equity sharing of a property, the method including: receiving details of a property inputted by a user; short listing the property for funding once score of the property is greater than a threshold; dividing the property into a plurality of equity shares, wherein each equity share indicates a fraction of ownership of the property; determining equity rate, wherein the equity rate is rate for each equity share; receiving an input from an investor searching for the property; providing option to the investor to purchase one or more equity shares; receiving indication of number of equity shares to be purchased by the investor; determining amount to be paid by the investor based on number of equity shares and the equity rate; transferring the amount to a trust; and storing ownership data including fractional ownership of the investor based on number of equity shares purchased by the investor.

[0029] CN 108428168 describes that sharing property rights of houses and solving the problem that property rights are divided, traded after division and rent distribution depend on a central server, trade is not transparent, and cannot be found in real time. The system provides a method for property rights lease and rent division based on a block chain technology.

[0030] US 2009/0164360 provides a real estate transaction system and method using real estate trust that are capable of lessening a burden on a residence right holder and investors by securitizing real estate and selling a plurality of divided securities including a security for ownership and a security for investment. A real estate special purpose company buys real estate and divides a right for real estate into a residence right and an investment right that is transacted as an investment security at a real estate security exchange, like normal security, with the residence right and the investment right having different dividend percentages, such that a buyer desiring actual residence resides on the property by paying only a portion of the price of the real estate and a person desiring investment invests in real estate for desired equity.

[0031] WO 2008/103901 provides a method that includes maintaining a database including information associated with a real-estate portfolio of an entity, where the real-estate portfolio includes one or more real-estate properties. The method also includes receiving selection of a property in the portfolio for offering one or more percentage ownerships thereof. An offering of one or more percentage ownerships of the respective property is initiated in response to the selection, initiating an offering including automatically notifying one or more other entities of the offering. And commitments are received from one or more other entities regarding respective percentage ownerships of the property to thereby facilitate the entity and one or more other entities concluding a percentage -ownership transaction regarding the property. As provided, the offering is retractable by the entity until the other entities commit to purchase, in the aggregate, a minimum percentage ownership of the respective property.

[0032] WO 2020/236638 discloses a method and system for managing life cycle ofatokenized real asset in a Blockchain-based ecosystem 100. The asset tokens of the real asset are put up for sale on a token issuance platform 118 and the proceeds from the sale are distributed to the asset owner, etc. The listing of asset tokens in the Blockchain-based ecosystem 100 requires project consensus which involves participation of key stakeholders who own utility tokens to participate in the community decision making. The asset tokens are then subjected to trading and maintenance which includes maintaining money flow corresponding to the real asset, selling the asset tokens by the asset token holders via an asset token exchange 808, and settlement of rewards to asset token holders via a settlement engine 810. Upon the end-of-term of the real asset, the asset tokens are terminated, and exit is enabled from the Blockchain-based ecosystem 100.

[0033] In each of US 2019/0287195, CN 108428168, US 2009/0164360, WO 2008/103901 and WO 2020/236638, a security claim exists in one of two forms, namely direct - specific and indirect - non-specific. Direct - specific claims are held directly over specific underlying real estate properties, through investors holding legal titles of ownership directly in the properties or investors holding equity securities only (not debt securities) in a holding entity owning only one specific real estate property, as described for example in US 2019/0287195 or US 2009/0164360. In contrast, indirect - non-specific claims are held indirectly - over the net assets (total equity) of the special purpose entity owning property or multiple properties (either through stocks or debt). Where security claims are indirect, they are not specific to the underlying real estate properties, but instead extend only to the net assets (total assets less total liabilities) owned by the special purpose holding entity.

Summary of the Present Invention

[0034] In one broad form, an aspect of the present invention seeks to provide a method of manufacturing a transferable asset, the method including: acquiring starting materials including a plurality of ownership items, each ownership item being in respect of a particular residential real property; and, performing a manufacturing process to generate end financial products using the starting materials, each end financial product being a tradable and/or transferable financial product and the manufacturing process including: transforming ownership items into a plurality of security items, each security item representing a fixed proportion of a value of the respective ownership item and unique expiry conditions of each respective ownership item, with direct ownership element extracted; creating multiple security pool items, each security pool item including single or multiple security items; splitting each security pool item into a plurality of security pool fraction items; and, creating plurality of tradable and/or transferable financial products from security pool fraction items as base components, each batch of financial products have its own unique value based on the attributes of the underlying security pool fraction items.

[0035] In one embodiment each ownership item includes at least one of: a fixed ownership stake in a residential real property; an occupancy charge in a form of a separate fixed ownership stake in the same property; an occupancy charge renewal option in a form of an additional fixed ownership stake in the same property; an option to offset various additional charges against purchase price; unique acquisition terms that provide a facility for the investor to at least one of: obtain cash return on investment in advance; and utilise the starting material in the production of a new financial product; and, a unique ownership item identifier.

[0036] In one embodiment the security items have respective attributes including at least one of: an expiry date; a set of expiry conditions that may trigger early expiry date; a fixed proportion of value of the respective ownership item; a secured claim associated with the residential real property; an added value; a stake of the value in the respective ownership item; a fixed proportion of value of the occupancy charge associated with the respective ownership item; unique guaranteed terms of investment; unique security item identifiers; and, a unique security item identifier that is passed on through further manufacturing steps to the end financial product to allow for verification of at least one of a value and authenticity of the financial product.

[0037] In one embodiment the method of transforming an ownership item into a plurality of security items includes at least one of: detaching any legal titles from ownership items; assigning new and unique properties, values and qualities; assigning unique security item identifiers; and, generating security items having different respective attributes.

[0038] In one embodiment the method of assembly of security pool items from security items includes creating security pool items having a new set of respective attributes including at least one of: a unique security pool item identifier; new and unique properties, values and qualities including new and inherited values; a unique mix of security claims associated with a pool of specific residential real properties; guaranteed investment terms; a unique structure of investment returns; and, dynamic expiry conditions. [0039] In one embodiment the method of producing security pool fraction items by splitting each security pool item includes splitting each security pool item into a sequence of security pool fraction items having another set of unique attributes, each including at least one of: a unique security pool fraction item identifier; new and unique properties including new and inherited values; a unique mix of security claims associated with a pool of specific residential real properties; guaranteed investment terms; a unique structure of investment returns; and, dynamic expiry conditions.

[0040] In one embodiment the method of producing unique end financial products includes using security pool fraction items as base components of end financial products, each end financial product having a respective allocation of the security pool fraction items.

[0041] In one embodiment a financial product at least one of: is associated with an owner, and wherein the method includes trading the financial products by updating the owner of the financial product; is assigned with a secure and unique identifier which carries the product’s attributes and ownership rights, and wherein the method includes trading the financial products by transferring the financial product’s secure and unique identifier; assigned with a secure and unique identifier which carries the product’s attributes, and wherein the method includes trading the financial products by physically transferring the financial product between traders independently from the marketplace; is legally and physically transferable; represents an independently existing physical product; includes authenticity verification information; includes a unique financial product identifier; includes a unique financial product identifier carrying new and unique attributes, properties of substance and qualities; includes a patent number to ensure product’s authenticity and protection from potential infringers; includes a unique legal structure; includes a unique investment return structure; includes a unique security claim associated with a unique mix of fractions of specific properties; includes unique and dynamic expiry conditions; includes a high liquidity and affordability; and, an ability to be transferred without ownership registry.

[0042] In one embodiment the method includes performing the manufacturing process using one or more processing devices by: generating starting data indicative of the plurality of ownership items; assigning unique item identifier to the starting data; storing the starting data in a data store; transforming the starting data to generate end financial product data indicative of the end financial products; and, storing the end financial product data.

[0043] In one embodiment the method includes, in the one or more processing devices, transforming the starting data by: generating and storing security item data indicative of each security item using the ownership item data; generating and storing security pool item data indicative of each security pool item using the security item data; generating and storing security pool fraction item data indicative of each security pool fraction item using the security pool item data; and, generating and storing the end financial product data using the security pool fraction item data.

[0044] In one embodiment the method includes, in the one or more processing devices, transforming the starting data by: generating and storing security item data by extracting legal titles associated with ownership item data and adding new data including unique guaranteed terms of investment, security conditions associated with ownership items, added value, unique dynamic expiry terms, assigning unique item identifier to each security item; generating and storing security pool item data by applying unique assembly criteria, creating new security claim structure and conditions, adding new value and attributes, assigning unique item identifier to each security pool item; generating and storing security pool fraction item data by splitting security pool items, creating new security claim structure and conditions, adding new value and attributes, assigning unique item identifier to each security pool fraction item; and, generating the end financial product data by using the security pool fraction item data as base component, adding new value, attributes and properties, assigning unique item identifier and patent identifier to each financial product and storing the end financial product data.

[0045] In one embodiment the starting data includes ownership item data for each ownership item, and wherein the ownership item data is indicative of at least one of: an ownership item identifier associated with the respective real property; a fixed ownership right attached to the acquired ownership item; a purchase price; a stake type in the proportion of the respective real property; a transfer of rights to a managing entity acquiring ownership items; unique acquisition and ownership rights that allow for the full cash return on investment in advance; a unique and separate reference to each of the respective security item, security pool item, security pool fraction item and the end product; an occupancy charge for a property owner selling the ownership item; an occupancy charge renewal option for a property owner selling the ownership item; occupancy conditions for a property owner selling the ownership item; and, a purchase price offset indicative of a value of the right of occupancy.

[0046] In one embodiment the security item data for each security item is indicative of at least one of: a security item identifier associated with the security item that is optionally passed on through further manufacturing steps to the end financial product to allow for verification of at least one of a value and authenticity of the financial product; an ownership item identifier associated with the ownership item data of the respective ownership item; and, security item attributes including any one or more of: an expiry date; a combination of expiry conditions which may trigger an early expiry date; a proportion of the value of the respective ownership item; secured claim; unique guaranteed terms of investment; an added value; a stake type in the proportion of the value of the respective ownership item; and, a value of the occupancy charge associated with the respective ownership item.

[0047] In one embodiment the security pool item data is indicative of at least one of: a security pool item identifier associated with the security pool item that is optionally passed on through further manufacturing steps to the end financial product to allow for verification of at least one of a value and authenticity of the financial product; security item identifiers associated with the single or multiple security items; ownership item identifiers associated with the ownership items data of the respective ownership items; and, security pool item attributes including any one or more of: a combination of expiry dates; a combination of expiry conditions which may trigger an early expiry date; a proportion of the values of the respective ownership items; unique secured claim being a unique mix of security claims associated with a pool of specific properties; unique guaranteed terms of investment; an added value; stake types in the proportion of the value of the respective ownership items; and, values of the occupancy charge associated with the respective ownership items.

[0048] In one embodiment the security pool fraction item data is indicative of at least one of: a security pool fraction item identifier associated with the security pool fraction items that is optionally passed on through further manufacturing steps to the end financial product to allow for verification of at least one of a value and authenticity of the financial product; security pool item identifiers associated with the security pool items; security item identifiers associated with the single or multiple security items; ownership item identifiers associated with the ownership items data of the respective ownership items; and, security pool fraction item attributes including any one or more of: a combination of expiry dates; a combination of expiry conditions which may trigger an early expiry date; a proportion of the values of the respective ownership items; unique secured claim being a fraction of the unique mix of security claims associated with a pool of specific properties; unique guaranteed terms of investment; an added value; stake types in the proportion of the value of the respective ownership items; and, values of the occupancy charge associated with the respective ownership items.

[0049] In one embodiment the end financial product data includes financial product data for each end financial product indicative of at least one of: a secure and unique financial product identifier associated with the financial product that is optionally passed on through further manufacturing steps to the end financial product to allow for verification of at least one of a value and authenticity of the financial product; a security pool fraction item identifier indicative of a respective security pool fraction item; a security pool item identifier associated with the respective security pool item; security item identifiers associated with respective security items; a patent identifier; and, ownership item identifiers associated with the ownership items data of the respective ownership items.

[0050] In one embodiment the method includes, in the one or more processing devices, creating and storing in a distributed data store, data that provides additional security, full audit trail and authenticity to the end financial product, including at least one of: details of trading of a financial product; starting data; end financial product data; ownership item data; security item data; security pool item data; security pool fraction item data; financial product data; unique and secure identifiers, providing full manufacturing audit trail, end product’s value guarantee and authenticity validation, for each of the ownership items, security items, security pool items, security pool fraction items, financial products; and, financial product patent identifiers representing a notice to potential infringers and a mark of product authenticity.

[0051] In one embodiment the method includes, in the one or more processing devices, creating and storing meta data that provides additional security, full audit trail and authenticity to the end financial product, wherein the meta data: contains both public (visible to all) and private (visible only to the owner) information; is maintained independently of the processing system to allow for the asset to be transferred between systems while maintaining integrity of the meta data; can be created, modified and removed by the processing system currently associated with the product; and, includes at least one of: details of trading of a financial product; starting data; end financial product data; ownership item data; security item data; security pool item data; security pool fraction item data; financial product data; includes unique and secure identifiers, providing full manufacturing audit trail, end product’s value guarantee and authenticity validation, for each of the ownership items, security items, security pool items, security pool fraction items, financial products; and, includes financial product patent identifiers representing a notice to potential infringers and a mark of product authenticity.

[0052] In one embodiment the method includes, in the one or more processing devices, trading a financial product by at least one of: updating the owner details of respective financial product data; by transferring the unique financial product identifier between financial product buyer and seller; and, physically transferring the financial product between financial product buyer and seller independently from a marketplace.

[0053] In one embodiment the method includes, physically transferring the financial product between a buyer and seller by: decrypting encrypted financial product data using a first decryption key associated with the seller; and, encrypting the financial product data using a second encryption key associated with the buyer.

[0054] In one embodiment the method includes updating ownership information stored within the financial product.

[0055] In one broad form, an aspect of the present invention seeks to provide a system for generating a transferable asset, the system including one or more processing devices configured to: generate starting data indicative of starting material including a plurality of acquired ownership items, each ownership item being in respect of a residential real property; store the starting data in a data store; perform a manufacturing process to generate end financial products using the starting materials, each end financial product being a tradable and/or transferable financial product and the manufacturing process being performed to transform the starting data to generate end financial product data indicative of the end financial products by: transforming ownership items into a plurality of security items, each security item representing a fixed proportion of a value of the respective ownership item and unique expiry conditions of each respective ownership item, with direct ownership element extracted; creating multiple security pool items, each security pool item including single or multiple security items; splitting each security pool item into a plurality of security pool fraction items; and, creating plurality of tradable and/or transferable financial products from security pool fraction items as base components, each batch of financial products have its own unique value based on the attributes of the underlying security pool fraction items; and, storing the end financial product data.

[0056] In one broad form, an aspect of the present invention seeks to provide a method of creating a transferable financial asset, the method including, in one or more processing devices and a distributed block-chain network: generating starting data indicative of starting material including a plurality of acquired ownership items, each ownership item being in respect of a respective real property, each item created and stored as a unique element that is subsequently added to a block chain in the production process; performing a batch manufacturing process to generate end financial products by creating unique block-chains of each batch, using the starting materials, to generate a tradable end financial product and the manufacturing process being performed to transform the starting data to generate end financial product data indicative of the end financial products by: converting each ownership item into a plurality of security items, each security item representing a fixed proportion of a value of the respective ownership item and unique expiry conditions, with a direct ownership data extracted, in a form of a new unique element of a block-chain data; and, creating multiple security pool items, each security pool item consists of the batch of security items to be processed, generated from different ownership items, each security pool item created in a form of a new unique element of a block- chain data; splitting each security pool item into a plurality of security pool fraction items, each security pool fraction item created as a new unique element of a unique block-chain data; and, creating an end financial product in a form of a block-chain financial asset on the block-chain network from security pool fraction items, each end financial product is created as anew unique element of a unique block-chain data, block-chain data including a patent identifier, wherein: each end financial product is created as an independent transferable asset capable of existing outside of the processing system with the owner of the end financial product acquiring full and independent control; and, each end financial product is capable of being traded independently of the processing system. [0057] In one broad form, an aspect of the present invention seeks to provide a system of creating a transferable financial asset, the system including one or more processing devices and a distributed block-chain network configured to: generate starting data indicative of starting material including a plurality of acquired ownership items, each ownership item being in respect of a respective real property, each item created and stored as a unique element that is subsequently added to a block chain in the production process; perform a batch manufacturing process to generate end financial products by creating unique block-chains of each batch, using the starting materials, to generate a tradable end financial product and the manufacturing process being performed to transform the starting data to generate end financial product data indicative of the end financial products by: converting each ownership item into a plurality of security items, each security item representing a fixed proportion of a value of the respective ownership item and unique expiry conditions, with a direct ownership element extracted, in a form of a new unique element of a block-chain data; and, creating multiple security pool items, each security pool item consists of the batch of security items to be processed, generated from different ownership items, each security pool item created in a form of a new unique element of a block-chain data; split each security pool item into a plurality of security pool fraction items, each security pool fraction item created as a new unique element of a unique block-chain data; and, create an end financial product in a form of a block-chain financial asset on the block-chain network from security pool fraction items, each end financial product is created as a new unique element of a unique block-chain data, block-chain data including a patent identifier, wherein: each end financial product is created as an independent transferable asset capable of existing outside of the processing system with the owner of the end financial product acquiring full and independent control; and, each end financial product is capable of being traded independently of the processing system.

[0058] In one broad form, an aspect of the present invention seeks to provide a method for generating a transferable asset, the method including, in one or more processing devices: generating starting data indicative of starting material including a plurality of acquired ownership items, each ownership item being in respect of a residential real property; storing the starting data in a data store; performing a manufacturing process to generate end financial products using the starting materials, each end financial product being a tradable and/or transferable financial product and the manufacturing process being performed to transform the starting data to generate end financial product data indicative of the end financial products by: creating a plurality of security items from ownership items, each security item representing a fixed proportion of a value of the respective ownership item and unique expiry conditions of each respective ownership item, with direct ownership element extracted; creating multiple security pool items, each security pool item including single or multiple security items; splitting each security pool item into a plurality of security pool fraction items; and, creating plurality of tradable and/or transferable financial products from security pool fraction items as base components, each batch of financial products have its own unique value based on the attributes of the underlying security pool fraction items; and, storing the end financial product data, wherein each element of data involved in the system is created in the form of meta data that: contains both public and private information; is maintained independently of the processing system to allow for the asset to be transferred between systems while maintaining integrity of the meta data; and, can be created, modified and removed by the processing system currently associated with the product.

[0059] In one broad form, an aspect of the present invention seeks to provide a system for generating a transferable asset, the system including one or more processing devices configured to: generate starting data indicative of starting material including a plurality of acquired ownership items, each ownership item being in respect of a residential real property; store the starting data in a data store; perform a manufacturing process to generate end financial products using the starting materials, each end financial product being a tradable and/or transferable financial product and the manufacturing process being performed to transform the starting data to generate end financial product data indicative of the end financial products by: creating a plurality of security items from ownership items, each security item representing a fixed proportion of a value of the respective ownership item and unique expiry conditions of each respective ownership item, with direct ownership element extracted; creating multiple security pool items, each security pool item including single or multiple security items; splitting each security pool item into a plurality of security pool fraction items; and, creating plurality of tradable and/or transferable financial products from security pool fraction items as base components, each batch of financial products have its own unique value based on the attributes of the underlying security pool fraction items; and, store the end financial product data, wherein each element of data involved in the system is created in the form of meta data that: contains both public and private information; is maintained independently of the processing system to allow for the asset to be transferred between systems while maintaining integrity of the meta data; and, can be created, modified and removed by the processing system currently associated with the product.

[0060] It will be appreciated that the broad forms of the invention and their respective features can be used in conjunction and/or independently, and reference to separate broad forms is not intended to be limiting. Furthermore, it will be appreciated that features of the method can be performed using the system or apparatus and that features of the system or apparatus can be implemented using the method.

Brief Description of the Drawings

[0061] Various examples and embodiments of the present invention will now be described with reference to the accompanying drawings, in which: -

[0062] Figure 1A is a flow chart of an example of a manufacturing method;

[0063] Figure IB is a flow chart of a further example of a method for manufacturing a financial product;

[0064] Figure 2 is a schematic diagram of a specific example of a network architecture;

[0065] Figure 3 is as schematic diagram of an example of a processing system;

[0066] Figure 4 is a schematic diagram of an example of a client device;

[0067] Figures 5A to 5C are a flow chart of a specific example of a manufacturing method; and,

[0068] Figure 6 is an example of a process for transferring ownership of a financial product.

Detailed Description of the Preferred Embodiments

[0069] An example of a manufacturing process will now be described with reference to Figure 1A. [0070] In this example, at step 100 the manufacturing process involves acquiring starting materials including a plurality of ownership items. The ownership items represent partial ownership of an asset, and in particular respective real property, such as a residential real property, including but not limited to housing, apartments, residential land, or the like.

[0071] At step 110, a manufacturing process is performed using the starting materials, with the manufacturing process being performed to create end financial products at step 120, which in one example at step 130 are tradable and/or transferable financial products.

[0072] The nature of the manufacturing process can vary, but in one example shown in Figure IB, this involves acquiring ownership items at step 150, which are data representative of a partial ownership of a particular residential real property. Such ownership items are typically acquired with unique acquisition terms which, among other things, provide the facility for the investor to obtain the full cash return on investment in advance and to utilise the ownership items in the production of a new physical financial product. By virtue of these being a discrete digital asset, they are in effect a physical product having associated mass and matter.

[0073] The ownership items are then processed at step 160, which typically involves transforming ownership items into a plurality of security items, each security item representing a fixed proportion of a value of the respective ownership item, such as a market value, or other suitable value, and a secured claim to such value. This process may also involve detaching any legal titles from ownership items and assigning new and unique properties, additional values, unique expiry conditions and unique security item identifiers to the created security items. The resulting security items can have unique guaranteed terms of investment, and represent a new component material, with unique security item identifiers attached, which can then be utilised in the process of creation of a new physical financial product.

[0074] At step 170, the security items are used to create multiple security pool items, with each security pool item including single or multiple security items generated from different ownership items. Thus, the security pool items can include security items associated with different residential real properties. In one example, this is performed by uniquely assembling security items and assigning each security pool item with a unique security item identifier and new and unique properties including new and inherited values. The security pool items typically represent a unique mix of security claims associated with a pool of specific property stakes, and can have guaranteed investment terms and a unique structure of investment returns, dynamic expiry conditions, or the like. Again, each security pool item can represent a new component material, with unique security item identifiers attached, which can be utilised in the process of creation of a new physical financial product.

[0075] At step 180, the security pool items are then split into a plurality of security pool fraction items. Each security pool fraction item can be assigned a unique security pool fraction item identifier and can have new and unique properties including new values, unique security claims in a form of a fraction of unique mix of security claims associated with a pool of specific property stakes, guaranteed investment terms and unique structure of investment return, dynamic expiry conditions, or the like.

[0076] Each security pool fraction item represents a new component material, which in turn become base component material of end financial products that are created in step 190, thereby giving the end financial product unique value and set of characteristics. Each financial product can represent an independently existing physical product. Each financial product can have a unique financial product identifier attached, which carries new and unique attributes, properties of substance and qualities including instant legal and physical transferability, unique legal structure, unique structure of investment return, unique security claim associated with unique mix of fractions of specific property stakes, unique and dynamic expiry conditions, high liquidity and affordability, ability to be transferred without ownership registry, and a patent number or other similar identifier.

[0077] The manufacturing process is typically performed at least in part using one or more electronic processing devices forming part of one or more processing systems. Whilst the system can use multiple processing devices, with processing performed by one or more of the devices, for the purpose of ease of illustration, the following examples will refer to a single device, but it will be appreciated that reference to a singular processing device should be understood to encompass multiple processing devices and vice versa, with processing being distributed between the devices as appropriate.

[0078] When a processing device is used, this typically involves generating starting data indicative of the plurality of ownership items, and then storing the starting data in a data store. The starting data is then typically transformed to generate end financial product data indicative of the end financial products, which can again be stored, allowing this to be subsequently retrieved and used as required.

[0079] Specifically, when the manufacturing process involves the steps outlined above, this typically involves having the processing device transform the starting data by generating and storing security item data indicative of each security item using the ownership item data, for example by extracting legal titles associated with ownership item data and adding new data including unique guaranteed terms of investment, added value, unique dynamic expiry terms. The processing device then generates and stores security pool item data indicative of each security pool item using the security item data. This is followed by the processing device generating and storing security pool fraction items data using security pool item data, before generating and storing the end financial product data using the security pool fraction items data.

[0080] Accordingly, in one example, the above described process includes two key stages working in synergy with each other and facilitated by a managing entity.

[0081] The first stage of the process involves the acquisition of a starting material in a form of fixed ownership stakes in residential real properties. Such a step is typically performed for individuals wishing to realise accumulated mortgage-free proportion of value in their properties and examples include retirees or other types of residential real property owners willing to benefit from the accumulated free equity in their residential real properties. This can be performed by having the managing entity purchase a stake in the residential real property of a customer, with the customer purchasing back a right of occupancy up-front, at the time of sale.

[0082] In this scenario, unique properties of the starting material include:

• Materially different nature from other options available for homeowners as no mortgage or debt type exposure is created

• Unique economic structure of the starting material (including an occupancy charge element) provides foundation for creation of the unique type of end financial product

• Cumulative nature and unique growth rates of value appreciation that is further enhanced and passed on through the manufacturing process • A real tangible asset that provides value guarantee built-in to the end financial product through the manufacturing process

• Facilitates liquidity of equity in residential real property through the process of its transformation and offering to the public

• Each item of starting material carries its own unique blend of socio-economic characteristics including property location, design, size, social environment, economic value, which contributes to the base value of the end financial product

• Each step of subsequent transformation of starting material during the manufacturing process includes creation of unique combinations of these base values which in turn adds new elements of economic value at each step

• Fixed and final purchase that results in the full and final transfer of ownership to the Managing entity acquiring ownership stakes

• Clearly defined purchase price represented by a fixed proportion of ownership in the real property with no further claims over remaining equity

• Mechanism for ownership stake vendors (homeowners selling a stake in their property) to retain economic benefits of capital gain appreciation in their strictly defined respective share of property

• Mechanism for ownership stake vendors to access considerable cash resources without any debt maintenance constrains

• Ability for ownership stake vendors to retain certainty of succession planning

• Purchase price is offset by the occupancy rights bought up-front by the homeowner by way of a price offset

• Ownership stake represents a commodity for both parties of the purchase transaction: o the homeowners - as a unit of economic wealth sold for cash o the Managing entity - as a unit of raw material

• Ownership stake in its capacity as a commodity is provided with a warranty of care by the homeowner

[0083] In the second stage, purchased house stakes undergo a number of artificial manufacturing steps through a series of technological steps implemented using processing devices such as computers, servers, or the like. This results in the creation of end financial products in a form of tradable financial assets that exist independently and are offered to external investors (both wholesale and retail), at a set trading margin.

[0084] For the managing entity such stakes, including the raw materials and processed financial products, are inventory items manufactured and offered for sale. For homeowners, sold house stakes represent a tradable commodity that is sold for the monetary value that can be exchange for other monetary, physical or non-monetary items.

[0085] Unique properties and qualities of end financial product include:

• regulated by a government agency or other independent regulatory body to ensure investor’s protection

• carries unique composition of economic value

• independent, separately identifiable and transferable financial asset

• clear from any legal ownership title transfer hurdles

• compounding and unique rates of return

• ease of access for both wholesale and small retail investors

• ease of trade on an open market and high liquidity

• unique combination of features that allows to follow housing market in a more economically beneficial way due to a multitude of product characteristics and associated values

• optional unique security over various items of real property

• defined maturity date which is not usually a feature under comparable offers

• an option to securely transfer financial product ownership

• optional ability for investors to transfer financial products based on secure and unique product identifiers through application of encrypted block chain technology

[0086] Accordingly, the above manufacturing process converts ownership stakes in properties, such as residential real properties, into tradable and/or transferable financial products, that can then be acquired by investors. The tradable and/or transferable financial products are tied to the value of the residential real property, which ensures that the value of the financial products increase in line with increases in property values. This makes the tradable and/or transferable financial products particularly suited for use by investors saving for a deposit to buy into the housing market, as their investments are linked to the property market, and it hence avoids them investing in other forms of investment that have lower growth rates, which in turn hampers people from buying into the property market.

[0087] For property owners, such as retirees for example, the value increase allows continued benefit of the capital growth from the appreciation of the retained fixed stake. For investors, in contrast, the financial products acquired are linked to multiple properties by virtue of the unique manner in which the products are manufactured, and this ensures investors have access to a broad variety of properties providing various investment returns. In particular, this results in a spread of risk, allowing an investor to invest in a wide variety of different property markets, whilst allowing the investor to do this using a desired investment amount, without for example having to invest significant amounts in multiple properties.

[0088] A number of other benefits exist, such as allowing identity of properties to be obscured from investors. This avoids investors seeking to only invest in "bluechip" or other desirable properties, meaning that investment is available to all property owners, regardless of the relative desirability of the properties, whilst for investors, this can be used to mitigate the risk of being heavily exposed to any particular property market.

[0089] Furthermore, the resulting financial product can be a discrete digital (or potentially print based) physical asset. An advantage of this is it can be transacted independently from the product register, where the current holder of the asset is able to physically transfer the asset directly to a buyer, with this process resulting in the buyer being the new owner. This can be facilitated through the use of encryption processes, but in any event, allows for the financial products to be more easily independently traded, as will be described in more detail below.

[0090] Additionally, the above process provides a mechanism for property owners to realise value on their property, without having to undergo a re-mortgaging process, thereby protecting the right of the individual to remain within their home.

[0091] Thus, the above arrangement provides key economic and social benefits (utility) for homeowners which includes:

• Fixed ownership stake

• No exposure to interest rates fluctuations or equity elimination through the escalating cumulative debt • No mortgage arrangement which can expose the homeowner’s stake to further claims

• Retained equity stake continues to grow in value and belongs to the homeowner

• No cash flow service requirements

• Guaranteed rights for the duration of the contract

• Certainty of succession planning

[0092] The above arrangement also provides key economic and social benefits (utility) for financial product investors:

• compounding return based on unique growth rates in value of the underlying real properties

• ease of trade on an open active market, thus highly liquid

• provides an opportunity to follow the housing market and save for a future home or other needs

• ability to transfer ownership of the financial asset independently

• financial benefits of the underlying real property without the need to hold a legal title

• no legal costs usually associated with transfer of direct ownership rights in the underlying properties

• ability to invest into the housing market without having to manage tenants and incurring associated costs

• guaranteed value over a real physical asset

[0093] Thus, the above described process can solve the issues associated with conventional solutions by offering a sale of a clearly defined stake up front, while allowing the full enjoyment of home use for the duration of the contract. This not only solves the risk of potential financial distress under the reverse mortgage offer or a loan default, but also removes the great deal of mental stress and uncertainty. Homeowners also benefit from the continued compounding growth of the remaining, fixed equity stake, thus growing their financial wealth.

[0094] Similarly, for financial asset holders (financial assets with a monetary value measurable in currency units), there are currently no obvious wide-spread assets that can offer similar advantages in one offer including cumulative return on a senior and secured investment, high liquidity and security over diversified pools of specific assets (single or multiple pools). [0095] It is further noted that each step of the manufacturing process contains unique elements not found in prior art, such as the document previously identified in the background section. For example, the current approach uses unique terms for acquiring and processing raw material, in the form of ownership items, including unique terms of investment returns capable of being fully monetised in advance, unique criteria for selecting, blending and splitting of unique securities, unique methods of assigning specific values, attaching dynamic expiry conditions and detaching legal titles.

[0096] The end result of the process is the creation of a unique physical product with unique attributes, that is transferable physically - by physically passing the product from one person to another; such product does not bear any registrable legal title to the real estate property (either directly to the property or to securities of the special purpose entity holding the property) or is not otherwise legally attached (directly or indirectly) to the property ownership (e.g. through a beneficial interest agreement, property sharing agreement, registered mortgage etc.), but instead exists independently from the manufacturer. An investor in the end product has no access or entitlement to original ownership stakes (directly or indirectly) or any information about them, and cannot influence any decision related to ownership stakes (e.g. asset selection, acquisition terms etc.).

[0097] The financial product has a unique product structure due to unique combinations of unique components bearing specific attributes not found in prior art (including unique combinations of underlying securities over values of unique pools of multiple stakes in various real estate properties, dynamic expiry conditions, removed legal title or claim to the original property stakes). The financial product has a unique product function by being means of unique investment in a form of a financial product bearing unique characteristics, not found in prior art (including unique rates and structure of investment and investment returns, unique risk profile (spread over multiple independent properties), security conditions, expiry conditions). Such product exists independently, is in a physical form and is transferable instantly, both physically and legally. The product is fully independent tangible financial asset with all the required properties under international accounting standards.

[0098] More specifically, in the prior art, the approach to create a product that is one of three things, namely: • a direct ownership right (item) in a real estate (e.g. a share of equity), which can be full, fractional or multi-fractional;

• an equity stake (equity security) in a holding vehicle (e.g. a trust, special purpose company etc.) that owns direct rights in the real estate;

• a property security (equity or debt security) either through debt or equity.

[0099] All of the above assets/products exist only in a form of a legal contract (ownership with certain rights). The ability to transfer such assets/products in prior art, therefore, relates only to transferring the ownership rights to the asset, i.e. transferring the legal contract, to another person. This involves, amongst other things, registering the ownership tile/right to the asset (a legal contract) with the respective registry (e.g. land title registry, stocks or debt registry).

[0100] In the current approach, the end financial product represents an independent tangible financial asset, with no legal attachment to underlying real estate properties through legal titles/ownership rights to the underlying real estate held directly or through holding entities. The financial product has its own value, properties and qualities, created by a unique manufacturing process. End financial products are instantly transferable physically and legally between independent traders, unlimited number of times. This is similar to trading of any other physical product, like for example a seller of apples physically transfers apples to the buyer. The financial product exists in a form of an electronic article, with its own mass and matter. The transferring of the product does not require its registration with any form of registry. The product is highly liquid, not owner dependent, and easily accessible to any type of investor through the product’s own unique electronic marketplace.

[0101] Ownership stakes in the current invention serve a unique combination of purposes not found in prior art, including:

• providing a unique investment return to the investor acquiring ownership stakes, such return fully monetised in advance;

• being a component material in the creation of the new financial asset/product, independent from the ownership stake, having unique properties of substance. Such product facilitating a short or a long-term investment return to the investors acquiring the financial product. [0102] As mentioned above, in the prior art a security item represents a security claim, such claim can exist in two forms that can be described as direct - specific and indirect - non-specific. In contrast, the current invention includes a form of a security item (claim), not found in the prior art, that is a unique hybrid of the two forms described above, being indirect - specific. This is an indirect claim, that can be, for example, a debt or equity security, issued by a holding entity owning multiple real estate properties, individually secured over value of the specific and limited mix of fractional stakes in multiple real estate assets, each item carrying unique investment terms that are passed on, through further manufacturing steps, to the end product.

[0103] Furthermore, the manufacturing employed by the current approach is distinct to the processes used in the prior art. Specifically the current approach uses interconnected and interdependent steps that together produce a specific and credible utility (end physical product, instantly transferable both physically and legally) with significant economic benefits, from the starting material (electronic articles of data representatives of the physical real estate assets), on the physical devices (computers, servers) by way of technology.

[0104] Each step of the manufacturing process results in the creation of new forms, qualities, properties and combinations given to the component materials and the end product. The end product is a tangible article and a commodity with significant economic utility, and each article produced can carry a patent number to provide a notice to potential infringers and is a mark of product’s authenticity. Each article produced can be physically transferred outside of the manufacturing facility and traded by independent external parties.

[0105] Additionally, in one example, a combination of one or more of block-chain, meta data and distributed data stores can be used to provide additional end product security, full manufacturing audit trail, value and authenticity validation, and facilitate instant physical and legal transferability.

[0106] When considering the above described manufacturing process, it is important to understand that this is performed in the field of finance and results in the creation of tangible financial asset with new qualities and form (both technical and economical), by means of adopting another financial asset for the purpose of creating the end tangible product, by using physical devices (machinery). The real tangible product and effect is produced from and to/in a form of tangible products being financial assets and cash. [0107] Thus, it is important to take into account that the process is performed in the finance industry, and therefore that key financial concepts that form basis of the manufacturing process are derived from the statute and respective standards approved by the relevant country statutes that govern the finance industry. In particular, definitions in relation to financial assets have the same meaning as in the international accounting standards adopted by international statue. As a result, the following key definitions from case law, financial law and public domain have been applied.

[0108] Manner of manufacture is defined as “an artificially created state of affairs of utility in a field of economic endeavour”, as per National Research Development Corporation v Commissioner of Patents (NRDC case) [1959] HCA 67, (1959) 102 CLR 252 (6 December 1959).

[0109] Manufacture is defined as including “starting material, the end product and the means for adopting one to the other” as per British Celanese Ltd v Courtaulds Ltd (1935) 52 R.P.C. 171. Further, manufacture requires “the production of articles for use from raw or prepared materials by giving to these materials new forms, qualities, properties or combinations, whether by hand-labor or by machinery” as per In re Nuijten 500 F.3d 1346 (Fed. Cir. 2007), where the Supreme Court also clarified that "manufacture" means both the process or operation of making products by hand, by machinery, or by other agency," and "anything made from raw materials, by the hand, by machinery, or by art" .

[0110] In re Nuijten the Supreme Court also clarified that patent eligible "manufacture [s]" are not limited to articles "that one can touch and hold,"; or that "live forever," or that are perceptible without the use of special equipment. This is in line with many other case law decisions. It also follows from this case that an electronic form of an article, stored on a computer memory or on a magnetic disk, and thus have their own mass and are matter. In Bilski v. Kappos, 561 U.S. 593 (2010) an article was deemed to potentially include electronic signals or data representative of physical objects or substances.

[0111] In view of the above, a product is understood as “covering every end produced” (NRDC) and “in relation to a process is only something in which the new and useful effect may be observed. ’’(Ibid). A process is that which clearly “defines starting material, the end product and the means for adopting one to the other”. (British Celanese Ltd.). Finally, a patentable process is “one that offers some advantage which is material, in the sense that the process belongs to a useful art... that its value to the country is in the field of economic endeavour”. (NRDC).

[0112] From New Zealand financial law, used as an example of international financial statute, key financial definitions are provided in statute based on internationally developed and recognised financial definitions and principles. Specifically, New Zealand Financial Reporting Act 2013 (the Act) introduces the following key definitions:

• financial reporting standard means a financial reporting standard issued by the Board under section 12; and includes an amendment to a financial reporting standard that is issued by the Board

• the Board means the External Reporting Board

[0113] The Board works with similar international bodies that produce international accounting standards (IAS). The international accounting standard 38 (IAS 38) defines an asset (physical and non-physical) as a resource that is:

• Controlled by an entity as a result of past events; and

• From which future economic benefits are expected to flow to the entity

[0114] An asset is identifiable if it is separable, i.e. is capable of being separated or divided from the entity and sold, transferred, licensed, rented or exchanged, either individually or together with a related contract, identifiable asset or liability, regardless of whether the entity intends to do so. Further, an intangible asset is an identifiable non-monetary asset without physical substance. Examples include scientific or technical knowledge, design and implementation of new processes or systems, licences, intellectual property, market knowledge and trademarks, and examples of items encompassed by these headings are: software, patents, customer lists, mortgage servicing rights, licences, marketing rights. Therefore, any asset that is not intangible asset is a tangible asset.

[0115] Monetary assets are money held and assets to be received in fixed or determinable amounts of money, whilst a financial asset is defined to include any asset that is (a) cash; (b) an equity asset of another entity; (c) a contractual right: (i) to receive cash or another financial asset from another entity; or (ii) to exchange financial assets or financial liabilities with another entity under conditions that are potentially favourable to the entity. A bond is an example of a financial asset.

[0116] IAS 2 defines that inventories are assets that are (a) held for sale in the ordinary course of business; (b) in the process of production for such sale; or (c) in the form of materials or supplies to be consumed in the production process or in the rendering of services.

[0117] Financial Markets Conduct Act 2013 introduces additional definitions in relation to financial products, specifically under section 7(1), as including a) a debt security; or b) an equity security. Section 7(2) clarifies that “If an interest or a right is declared by regulations not to be a security for the purposes of this Act, the interest or right is not a financial product for the purposes of this Act”. Under section 6 a definition of Security includes: a facility that has, or is intended to have, the effect of a person making an investment and includes a financial product.

[0118] Further, accordingly, to dictionary definitions, a commodity (economics) is an exchangeable unit of economic wealth, a primary product or raw material.

[0119] Applying this understanding to the above described manufacturing process, it is apparent that the process involves a set of interconnected and interdependent “product creation” steps, that together produce a specific and credible utility with significant economic and social benefits, from starting material, on the physical device and by way of technology.

[0120] In the context of New Zealand, Section 14 of the NZ Patents Act 2013 sets out criteria of patentable inventions, including that the invention “is a manner of manufacture within the meaning of section 6 of the Statute of Monopolies”. The New Zealand patent office, in their definition of the “manner of manufacture”, rely on the criteria established by the NRDC case, which includes a key requirement that an invention must produce an artificially created state of affairs resulting in the physical phenomenon in which a useful effect may be observed.

[0121] The resulting product must also be in the field of the Useful Arts, which includes:

• Tangible assets: financial assets produced as a result of the invention are tangible assets as defined by the case law (and the underlying physical laws) and international financial standards approved by statutes of relevant governments, including New Zealand (Financial Reporting Act 2013): o they are tangible assets and/or a commodity o they are identifiable monetary assets measurable in units of currency

• Economic utility: Such tangible assets have material advantage and significant economic effect with real-world economic result for the public benefit.

[0122] The criteria of “Artificially created state of affairs” include a discernible end result in which the new and useful effect may be observed. It is therefore apparent that the above described process results in an artificially created state of affairs that is discernible and has a commercially useful effect, and that is of utility in a field of economic endeavour (NRDC case), in that it results in a form of tangible financial assets (e.g. cash, financial products) -that are discernible and have significant commercially useful effect and utility in a field of economic endeavour not only for direct participants (homeowners, intermediaries, investors) but to the respective country as a whole.

[0123] The above described process further produces significant commercial and socio economic usefulness and provides remarkable economic advantage for all participants as well as the society as a whole, by reducing a burden on the Government for financial support to low-income earners.

[0124] The above described process further belongs to the useful arts as it results in the creation of specific, credible and substantial utilities in a form of tangible products, which are specific, credible and substantial. The achievement of the results follows a clearly defined, specific process.

[0125] The above process further provides substantial utility that corresponds to a significant real-world utility, in that the process will provide a significant public benefit and is supported by the concrete need in the art due to:

• For Elderly homeowners: High costs of living and significantly reduced ability of elderly to enjoy a better quality life style. The invention allows for the use of own home to tap into the otherwise unavailable wealth resource on the terms that are significantly more favourable than majority of currently existing and readily available alternatives, as well as certainty of succession planning

• Other homeowners: ability to enter into and benefit from the investment in the housing market at more favourable financial terms (e.g. improved borrowing ability, reduced cash requirements for servicing any accompanying debt)

• For Financial asset holders: provided with an alternative investment option with a potential for significantly higher financial results based on the compounding return from a secured investment, that is considerably less volatile than much risker alternatives. At the same time, the investment is highly liquid and can be easily exchanged for cash on the on-line market. The growth rate matches the residential housing market, thus allowing product holders to stay with the trend, which not only allows to achieve a greater economic benefit and significantly higher quality of investment through secured value, but also helps building a more financially secure future.

[0126] The above described process further provides specific & credible utility in that it provides two key utilities for two major groups of participants, including:

• Homeowners: it allows a sale of a fixed stake in a residential real property with the right to remain in their own home on the clearly defined terms, thus providing immediate financial benefit, as well as certainty of ownership structure and succession planning. They also benefit from continuing appreciation of the remaining ownership stake in the house value. No debt is created.

• Financial asset holders: an alternative investment that is secured over specific asset pool and provides an economic return on specifically defined terms, with potential of high financial returns. It allows to “follow the housing market” and helps build personal wealth.

[0127] The utilities are credible in that a “person skilled in the art would accept that the utility recited for the claimed invention is logical and consistent with the state of the art”. It is therefore apparent that the above described process is a manner of manufacture according to New Zealand law. [0128] In considering the invention from a broader international perspective, in addition to utility discussed above, another key requirement is whether the invention is in an excluded category, including whether the invention is a process or business method. Statutory excluded categories include “Laws of nature, natural phenomena, and abstract ideas” or “judicial exceptions”. If the categories are not excluded, the subject matter must still avoid the judicial exception in order to be eligible.

[0129] Types of abstract ideas have been defined, for example by the United States Patent and Trademark Office (USPTO), as including:

• Mathematical concepts - mathematical relationships, mathematical formulas or equations, mathematical calculations;

• Certain methods of organizing human activity - fundamental economic principles or practices (including hedging, insurance, mitigating risk); commercial or legal interactions (including agreements in the form of contracts; legal obligations; advertising, marketing or sales activities or behaviors; business relations); managing personal behavior or relationships or interactions between people (including social activities, teaching, and following rules or instructions); and

• Mental processes - concepts performed in the human mind (including an observation, evaluation, judgment, opinion).

[0130] Whilst the above described process may be considered as business method process, it nevertheless includes clearly defined steps that result in the creation of a significant, specific, credible utility in the field of economic endeavour. Also, it is performed via physical devices and the use of modem technology in a substantial way. Furthermore, the process includes clearly defined starting material, the end financial product and the means for adopting one to the other. This definition of manufacture is in line with the most relevant case law, in Nuijten, where both, the Federal Circuit and the Supreme Court relied on similar definitions. Specifically, two of the most relevant criteria from the Nuijten case was that in order to fit the “manufacture” category, an invention must be: "the production of articles for use from raw or prepared materials by giving to these materials new forms, qualities, properties or combinations, whether by hand-labor or by machinery”. [0131] Notably taking into account the legal definition of tangible assets, as previously discussed, it is apparent the financial products are created by transforming physical starting materials into physical end products. Therefore, if it can be shown that the invention satisfies the above definitions of the manufacture, it is patent eligible under this category.

[0132] Additionally, it is noted that the manufacturing process is not directed at an abstract idea as it does not contain any characteristic thereof. For example, it is not a mathematical concept as it is not: mathematical relationships, mathematical formulas or equations, or mathematical calculations.

[0133] Furthermore the process is not a method of organizing human activity. In this regard, it is not directed at a fundamental economic principle(s) or practice such as hedging, insurance or mitigating risks, but rather is directed to a very specific process for manufacturing a specific financial product. Any element of such practices or principles that may be included in the characteristics of the resulting products created by the process are only ancillary and do not form the main purpose of the process. Also, the resulting financial product is not a type of financial instrument that is designed to protect against the risk of investing in financial instruments.

[0134] Additionally, the process is not directed at merely creating commercial or legal interactions in the form of contracts, legal obligations, advertising, marketing or sales activities or behaviours, and business relations. By way of an example, the invention is materially different from a claim in Fort Properties, Inc. v. American Master Lease, LLC which is used as an example of a commercial or legal interaction by the USPTO. Instead, the invention leads to the creation of substantial utility in a form of a tangible commodity, a recognised class of the financial assets, which is separate, identifiable and is independently tradable on an open market.

[0135] The above described process is also not mere “mental processes” such as for example observations, evaluations, judgement and opinions.

[0136] In considering the tangible nature of the process further, it is apparent that both raw (or starting) material and the end financial product of the process fit the definition of tangible articles both in case law (and the underlying physical laws) and statute of financial laws. The applicability of financial laws is justified by the fact that the utility assessment is closely related to the requirement for the resulting tangible article or commodity in the field of the economic endeavour. Since the process lies in the field of finance and the financial laws are the only statutory mechanism that describes products and processes in this field, it is appropriate that these laws are relied on for the definition of the financial items utilised and produced by the process.

[0137] Further support can be found in the above mentioned cases. For example, In re Nuijten, the Supreme Court clarified that patent eligible "manufacture[s]" are not limited to articles "that one can touch and hold,"; or that "live forever," or that are perceptible without the use of special equipment. This is in line with many other case law decisions. The Supreme Court also added a requirement that “manufacturing patentees to provide notice to potential infringers by marking their patent numbers on each "article" covered by their patents”.

[0138] Assets (both physical and financial) used as a starting material and as the end financial product, satisfy the definition of a “commodity”. Both are traded and produce a definite and tangible economic utility as part of the above described process. This aspect of the financial assets utilised in and created by this process, places them outside of any possible classification as mere fundamental economic principle of organising human activity, such as hedging for example, as the main purpose of the commodity is the flow of economic benefit. The starting material is bought as a commodity. The end financial product, which is given new properties, form and qualities during the manufacturing process, is sold as a commodity to and between market participants multiple times and independently from the starting material. The value of the end financial product is determined by the market participants. The end financial products can be transferred outside of the “manufacturing facility” and individually assigned with a patent identification number.

[0139] Furthermore, in accordance with definitions provided in financial law, physical and financial assets utilised in the process are:

• tangible assets that represent an economic resource and carry all rewards of ownership, and

• are separable, as they can be sold or transferred as a separate commodity, and

• their value is fixed or determinable [0140] Performing a manufacturing process assessment, it is apparent that "the production of articles for use from raw or prepared materials by giving to these materials new forms, qualities, properties or combinations, whether by hand-labour or by machinery”, is a definition that applies in this instance, as the process produces tangible articles/commodities (financial assets that are tradable on financial market) with new properties, qualities and form, from starting material in the form of other tangible articles/commodities (house stakes acquired from homeowners), by machinery in the form of computers and servers.

[0141] It is also noted that patent protection for the above process will create a critical business incentive for a business process that will greatly contribute to public welfare, which is the intended purpose of the patent system. Protection would allow the business to stay competitive due to the size of potential competition in a form of large financial institutions, whereas alternative approaches, such as first to market effect will only be short-lived.

[0142] The highly regulated industry with strict requirements for public disclosure on various stages of the process will immediately expose the business process to general public and remove any advantage of a trade secret. Furthermore, the innovative ways of using pre-existing solutions employed by the above process can also be easily copied by the competitors who have not come up with these ways on their own.

[0143] Patent protection will therefore ensure the viability of the business that has an immense potential for millions of people to benefit financially and socially, improve their well-being and feeling of future security. There is further no risk to stifling of innovation as the competition already offers its own products that would still allow it to earn significant financial gains.

[0144] It is therefore readily apparent that the above described process should be considered patent eligible, and that granting of patent rights would be of significant public benefit, in line with the intended goals of the patent system.

[0145] A number of further features will now be described.

[0146] Each ownership item defines the terms and extent of rights acquired in the residential real property. This typically includes any one or more of a fixed ownership stake, defined purchase price, an occupancy charge in a form of a separate fixed ownership stake in the same property, an occupancy charge renewal option in a form of an additional fixed ownership stake in the same property and an option to offset various additional charges against purchase price, although it will be appreciated that other criteria may be specified depending on the preferred implementation. Other example criteria include a transfer of rights to a managing entity, a right of occupancy for a current property owner and/or a purchase price offset indicative of a value of the right of occupancy. The ownership items may also include acquisition terms that provide a facility for the investor to obtain cash return on investment in advance and/or utilise the starting material in the production of a new financial product. Finally, the ownership items also typically include a unique ownership item identifier, which can be passed on through further manufacturing steps, to the end financial product, and is intended for, among other things, the end financial product’s value and authenticity validation, and providing a full manufacturing audit trail.

[0147] In one example, the security items are assigned respective attributes, which can be used to add value to the security items beyond that which would be accrued from the ownership items. The attributes could include an expiry date that shows the maximum time the security item will be able to accumulate the return on investment and/or a set of expiry conditions that may trigger an early expiry date. This is assigned to ensure certainty of the term carried by a security item, as it is built-in into the properties of the end financial product. This allows investors of the end financial product to collect financial returns at specifically defined point of time, with the fixed expiry date further allowing for an estimated investment return to be calculated at any point in time, which in turn helps establish a trading price.

[0148] The attributes of the security item could include a fixed proportion of value, such as a market or other value in the respective ownership item, defining the proportion of the market (or other) value of the ownership item that is allocated to the security item. The attributes could include a secured claim over the fixed proportion of value of the residential real property and/or an added value, as well as a stake type value in the respective ownership item, for example defining whether the security item is in respect of a proportion of the entire property or some part of it only. Attributes could include a value, such as a market or other value, of the respective ownership item or of the occupancy charge associated with the respective ownership item. The attributes may also include unique guaranteed terms of investment, allowing owners to understand the terms of their investment. The security item will also typically include a unique security item identifier, which is typically passed on through further manufacturing steps to the end financial product to allow for verification of at least one of a value and authenticity of the financial product.

[0149] Typically the method involves transforming an ownership item into security items having different respective attributes, so for example security items may relate to different proportion of the ownership item, and hence have different values, whilst some may relate to different item of a real property. This can be used to create a wide variety of different security items, in turn increasing the flexibility in the end financial products that are created. The transformation typically includes detaching any legal titles from ownership items, assigning new and unique properties, values and qualities and assigning unique security item identifiers, with these again being propagated through the manufacturing process to the end product. It will be appreciated from this that each security item is typically capable of existing independently from the respective ownership item, and can be used as component material in the production of another tangible financial asset.

[0150] In one example the method of assembly of security pool items from security items includes creating security pool items, by applying unique assembly criteria and assigning new form of security claim associated with a unique combination of multiple underlying real estate property stakes, assigning each security pool item with a new set of respective attributes, properties, values and qualities, assigning unique item identifier; each security pool item is capable of existing independently, to be used as a component material in the production of another tangible financial asset.

[0151] In one example, splitting each security pool item involves splitting each security pool item into smaller security pool fraction items. Each security pool fraction item has another set of unique attributes, including one or more of a unique security pool fraction item identifier, new and unique properties including new and inherited values, a unique mix of security claims associated with a pool of specific property stakes, guaranteed investment terms, a unique structure of investment returns, and/or dynamic expiry conditions.

[0152] The security pool fraction items become base component material of a sequence of financial products, each product having a respective allocation of the security pool fraction items. Each financial product is typically one or more of: is legally and physically transferable, represents an independently existing physical product, includes authenticity verification information, includes a unique financial product identifier, a patent identifier, carries new and unique attributes, properties of substance and qualities, includes a unique legal structure, includes a unique investment return structure, includes a unique security claim associated with a unique mix of fractions of specific properties, includes unique and dynamic expiry conditions, includes a high liquidity and affordability and/or includes an ability to be transferred without ownership registry.

[0153] In one example, each financial product is associated with an owner, and wherein the method includes trading the financial products by updating the owner of the financial product. Thus, it will be appreciated that the financial products are tradable in their own right, and can be bought and sold by investors, allowing investors to realise their investment, prior to expiry dates of the security items, and hence providing greater flexibility for investors.

[0154] In one example, each financial product is assigned with a secure and unique identifier, and wherein the method includes trading the financial products by transferring the product’s secure and unique identifier from the seller to the buyer of the financial product. Thus, it will be appreciated that the financial products are tradable in their own right, and can be bought and sold by investors, independently from the product register, allowing investors to realise their investment, prior to expiry dates of the security items, and hence providing greater flexibility for investors.

[0155] In one example, the method includes performing the manufacturing process using one or more processing devices by generating starting data indicative of the plurality of ownership items, storing the starting data in a data store, transforming the starting data to generate end financial product data indicative of the end financial products and storing the end financial product data. The transformation is typically performed by generating and storing security item data indicative of each security item using the ownership item data, generating and storing security pool item data indicative of each security pool item using the security item data, generating and storing security pool fraction item data indicative of each security pool fraction item using the security pool item data and generating and storing the end financial product data using the security pool fraction item data. Accordingly, this process typically involves the physical transformation of electronic articles, which effectively have their own mass and matter, and hence corresponds to the physical transformation of physical products.

[0156] In one particular example, the transformation involves generating and storing security item data indicative of each security item by extracting legal titles associated with ownership item data and adding new data including unique guaranteed terms of investment, fixed proportions of value, added value, occupancy charge data, unique dynamic expiry terms, generating and storing security pool item data indicative of each security pool item using the security item data, by applying unique assembly criteria and adding new value and attributes, generating and storing security pool fraction item data indicative of each security pool fraction item using the security pool item data and generating the end financial product data, using the security pool fraction item data, and storing the end financial product data.

[0157] It will be appreciated that performing these steps in a processing device allows the manufacturing process to be performed automatically and/or substantially automatically, improving the efficiency with which end financial products can be created, and allowing for an increased complexity of the end financial products, for example allowing the system to use algorithms to construct security items having a wide range of attributes. Additionally, creating and storing data in this manner, can be used to provide an audit trail, which is important in ensuring financial compliance. For example, data can be stored in an encrypted database, and/or a distributed data store, where copies of the data are held in multiple locations, such as a blockchain, to prevent the data being subsequently manipulated, thereby ensuring the data is indicative of the ownership items that have been acquired and the subsequent end financial products that have been generated.

[0158] In one example, the starting data includes ownership item data for each ownership item, with the ownership item data being indicative of one or more of details required to identify the ownership item and the value and/or rights associated with the ownership item. This can include information such as any one or more of an ownership item identifier associated with the respective real property, a fixed ownership right attached to the acquired ownership item, a purchase price, a transfer of rights to a managing entity acquiring ownership items, unique acquisition and ownership rights that allow for the full cash return on investment in advance, a unique and separate reference to each of the respective security item, security pool item, security pool fraction item and the end product, an occupancy charge for a property owner selling the ownership item, occupancy conditions for a property owner selling the ownership item and a purchase price offset indicative of a value of the right of occupancy.

[0159] Similarly, the security item data for each security item is typically indicative of one or more of identifying information, information regarding the respective ownership item from which the security item is generated, the value of the security item, and any other relevant information. This can include, but is not limited to, any one or more of a security item identifier associated with the security item that is optionally passed on through further manufacturing steps to the end financial product to allow for verification of at least one of a value and authenticity of the financial product, an ownership item identifier associated with the ownership item data of the respective ownership item and/or details of security item attributes, such as an expiry date, a combination of expiry conditions which may trigger an early expiry date, a proportion of the value, such as a market or other value, of the respective ownership item, a secured claim, unique guaranteed terms of investment, an added value, a stake type in the proportion of the value, such as a market or other value, of the respective ownership item, and/or a value, such as a market or other value, of the occupancy charge associated with the respective ownership item.

[0160] The security pool item data typically includes one or more of a security pool item identifier associated with the security pool item that is optionally passed on through further manufacturing steps to the end financial product to allow for verification of at least one of a value and authenticity of the financial product, information regarding the security items that form part of the security pool item, such as an ownership item identifier associated with the ownership item data of the respective ownership item, as well as information allowing the security pool item to be identified, which could include a security pool item identifier associated with the security pool item and security item identifiers associated with the single or multiple security items that form the security pool item. The security pool item data also typically includes security pool item attributes such as any one or more of a combination of expiry dates, a combination of expiry conditions which may trigger an early expiry date, a proportion of the values of the respective ownership items, unique secured claim being a unique mix of security claims associated with the pool of stakes in specific properties, unique guaranteed terms of investment, an added value, stake types in the proportion of the value of the respective ownership items and/or values of the occupancy charge associated with the respective ownership items.

[0161] The security pool fraction item data typically includes one or more of a security pool fraction item identifier associated with the security pool fraction items that is optionally passed on through further manufacturing steps to the end financial product to allow for verification of at least one of a value and authenticity of the financial product, information regarding the security pool items that form part of the security pool fraction item, as well as information allowing the security pool fraction item to be identified, which could include a security pool fraction item identifier associated with the security pool fraction item, security pool item and security item identifiers associated with the single or multiple security items and security pool items that form component material for creation of the security pool fraction items. The security pool fraction item data also typically includes security pool fraction item attributes including any one or more of a combination of expiry dates, a combination of expiry conditions which may trigger an early expiry date, a proportion of the values of the respective ownership items, unique secured claim being a fraction of the unique mix of security claims associated with the pool of stakes in specific properties, unique guaranteed terms of investment, an added value, stake types in the proportion of the value of the respective ownership items and/or values of the occupancy charge associated with the respective ownership items.

[0162] In one example, the end financial product data includes financial product data for each financial product indicative of one or more of a secure and unique financial product identifier associated with the financial product that is optionally passed on through further manufacturing steps to the end financial product to allow for verification of at least one of a value and authenticity of the financial product, a security pool fraction item identifier that is used to identify the security pool fraction item from which the financial product is generated, an owner of the financial product identifier and the patent number. Thus, the financial product data can include a secure and unique financial product identifier associated with the financial product, a security pool fraction item identifier associated with the security pool fraction item, a security pool item identifier associated with the security pool item, security item identifiers associated with security items included in a security pool item, an owner of the financial product identifier and a patent identifier, such as a patent number or patent application number, or any other patent identifier, which provides additional product security by representing a notice to potential infringers and a mark of authenticity of the end financial product. This allows the financial product to be independently traded in or outside of an open market by transferring the owner details of the respective financial product data and/or by transferring the unique financial product identifier between financial product buyer and seller.

[0163] In one example, the identifiers associated with the items created at each stage will be in the form of system generated unique serial numbers that will allow the full traceability through the production process, and which will also link the items utilised throughout the production process in a sequence. Thus, it will be appreciated that the end financial product can include security pool fraction item identifiers, security pool identifiers and security items identifiers, of the security pool fraction items, security pool and security items from which the financial product is constructed. This allows for full traceability and tracking of items within the system.

[0164] As previously mentioned, some of the data may be stored in a distributed data store, such as a blockchain, or similar, which can be used to provide additional security, full audit trail and authenticity to the end financial product. The distributed and encoded nature of the blockchain is particularly useful as this can be used to prevent data that have been added to the blockchain from being subsequently altered. This, in turn, allows these to act as an absolute record of the items and financial products created, and any transactions performed using the products, providing immutable evidence of the items created and transactions performed. Examples of data that can be stored in this manner include details of trading of a financial product and some or all of the starting data, some or all of the end financial product data, some or all of the ownership item data, some or all of the security item data, some or all of the security pool item data, some or all of the security pool fraction item data and/or some or all of the financial product data. Stored data may also include unique and secure identifiers, providing full manufacturing audit trail, end product’s value guarantee and authenticity validation, for each of the ownership items, security items, security pool items, security pool fraction items, financial products and/or financial product patent identifiers representing a notice to potential infringers and a mark of product authenticity.

[0165] In one example, the one or more processing devices create and store meta data, which can be used to provide additional security, full audit trail and authenticity to the end financial product. This can contain both public (visible to all) and private (visible only to the owner) information and can be maintained independently of the processing system to allow for the asset to be transferred between systems while maintaining integrity of the meta data. The meta data can be created, modified and removed by the processing system currently associated with the product and may include any one or more of details of trading of a financial product, starting data, end financial product data, ownership item data, security item data, security pool item data, security pool fraction item data or financial product data. The data can also include unique and secure identifiers, providing full manufacturing audit trail, end product’s value guarantee and authenticity validation, for each of the ownership items, security items, security pool items, security pool fraction items, financial products and/or includes financial product patent identifiers representing a notice to potential infringers and a mark of product authenticity.

[0166] In a further example, a system and method of creating a transferable financial asset can be provided. In this example, one or more processing devices and a distributed block-chain network configured to generate starting data indicative of starting material including a plurality of acquired ownership items, each ownership item being in respect of a respective real property, each item created and stored as a unique element that is subsequently added to a block chain in the production process.

[0167] Following this a batch manufacturing process can be performed to generate end financial products by creating unique block-chains of each batch, using the starting materials, to generate a tradable end financial product and the manufacturing process being performed to transform the starting data to generate end financial product data indicative of the end financial products. Typically this is achieved by converting each ownership item into a plurality of security items, each security item representing a fixed proportion of value of the respective ownership item and unique expiry conditions in a form of a new unique element of a block- chain data and creating multiple security pool items, each security pool item consists of the batch of security items to be processed, generated from different ownership items, each security pool item created in a form of a new unique element of a block-chain data. Each security pool item can then be split into a plurality of security pool fraction items, each security pool fraction item being created as a new unique element of a unique block-chain data. [0168] End financial products in the form of a block-chain financial asset on the block-chain network are created from security pool fraction items, each end financial product is created as a new unique element of a unique block-chain data, with the block-chain data including a patent identifier. Each end financial product is created as an independent transferable asset capable of existing outside of the processing system, such as in a personal e-wallet for example, with the owner of the end financial product (asset) acquiring full and independent control. Each end financial product is also capable of being traded independently of the processing system.

[0169] In a further example, a system and method for generating a transferable asset can be provided. In this example, one or more processing devices configured to generate starting data indicative of starting material including a plurality of acquired ownership items, each ownership item being in respect of a residential real property and store the starting data in a data store. Once this has been completed, a manufacturing process is performed to generate end financial products using the starting materials, each end financial product being a tradable and/or transferable financial product and the manufacturing process being performed to transform the starting data to generate end financial product data indicative of the end financial products.

[0170] This can be performed by creating a plurality of security items from ownership items, each security item representing a fixed proportion of the value, such as a market or other value, of the respective ownership item and unique expiry conditions of each respective ownership item, with direct ownership element extracted. Multiple security pool items are then created, with each security pool item including single or multiple security items, and with the security pool items being split into a plurality of security pool fraction items.

[0171] Finally, a plurality of tradable and/or transferable financial products can be created from security pool fraction items as base components, each batch of financial products have its own unique value based on the attributes of the underlying security pool fraction items.

[0172] The end financial product data is stored, with each element of data involved in the system (staring data, security item data, security pool item data, security pool fraction item data, end financial product data) being created in the form of a meta data that contains both public (visible to all) and private (visible only to the owner) information, is maintained independently of the processing system to allow for the asset to be transferred between systems while maintaining integrity of the meta data and can be created, modified and removed by the processing system currently associated with the product.

[0173] In one example, financial product can be traded by any one or more of updating the owner details of respective financial product data, transferring a unique financial product identifier between financial product buyer and seller and physically transferring the financial product between financial product buyer and seller independently from a marketplace.

[0174] When physically transferring the financial product between a buyer and seller, this typically involves decrypting encrypted financial product data using a first decryption key associated with the seller and then encrypting the financial product data using a second encryption key associated with the buyer, optionally also updating ownership information stored within the financial product. This approach ensures that any individual holding the decryption key for decrypting the financial product data can be assumed to the rightful owner of the financial product. This in turn allows the financial product to be used and exchanged independently from the product register, where the holder is deemed to be the rightful owner, allowing the holder to redeem the investment in accordance with any attributes defined within the financial product. As an option, the owner of the financial product can store an encryption key in their own account held on the exchange.

[0175] A specific example of a network architecture for use in implementing the above described processes will now be described in more detail with reference to Figures 2 to 4.

[0176] In this example, the network architecture includes a plurality of processing systems 210, such as servers, a number of client devices 230, and data sources, such as databases 240, which in use are coupled to a communications network 220, such as a Local Area Network (LAN), Wide Area Network (WAN), and/or the Internet.

[0177] It will be appreciated that the configuration of the network(s) 220 are for the purpose of example only, and in practice the client devices 230 and the processing systems 210 can communicate via any appropriate mechanism, such as via wired or wireless connections, including, but not limited to mobile networks, private networks, such as an 802.11 networks, the Internet, LANs, WANs, or the like, as well as via direct or point-to-point connections, such as Bluetooth, or the like. [0178] Whilst the processing systems 210 are shown as a single entity, it will be appreciated that in practice the processing systems 210 can be distributed over a number of geographically separate locations, for example as part of a cloud-based environment. However, the above described arrangement is not essential and other suitable configurations could be used.

[0179] An example of a suitable processing system 210 is shown in Figure 3.

[0180] In this example, the processing system 210 includes at least one microprocessor 311, a memory 312, an optional input/output device 313, such as a keyboard and/or display, and an external interface 314, interconnected via a bus 315 as shown. In this example the external interface 314 can be utilised for connecting the processing system 210 to peripheral devices, such as the communications networks 220, 250, databases 240, other storage devices, or the like. Although a single external interface 314 is shown, this is for the purpose of example only, and in practice multiple interfaces using various methods (e.g. Ethernet, serial, USB, wireless or the like) may be provided.

[0181] In use, the microprocessor 311 executes instructions in the form of applications software stored in the memory 312 to allow the required processes to be performed. The applications software may include one or more software modules, and may be executed in a suitable execution environment, such as an operating system environment, or the like.

[0182] Accordingly, it will be appreciated that the processing system 210 maybe formed from any suitable processing system, such as a suitably programmed client device, PC, web server, network server, or the like. In one particular example, the processing system 210 is a standard processing system such as an Intel Architecture based processing system, which executes software applications stored on non-volatile (e.g., hard disk) storage, although this is not essential. However, it will also be understood that the processing system could be any electronic processing device such as a microprocessor, microchip processor, logic gate configuration, firmware optionally associated with implementing logic such as an FPGA (Field Programmable Gate Array), or any other electronic device, system or arrangement.

[0183] As shown in Figure 4, in one example, the client device 230 includes at least one microprocessor 431, a memory 432, an input/output device 433, such as a keyboard and/or display, and an external interface 434, interconnected via a bus 435 as shown. In this example the external interface 434 can be utilised for connecting the client device 230 to the communications networks 220, 250, databases, other storage devices, or the like. Although a single external interface 434 is shown, this is for the purpose of example only, and in practice multiple interfaces using various methods (e.g. Ethernet, serial, USB, wireless or the like) may be provided.

[0184] In use, the microprocessor 431 executes instructions in the form of applications software stored in the memory 432 to allow for communication with the processing systems 210, as well as to allow user interaction for example through a suitable user interface.

[0185] Accordingly, it will be appreciated that the client devices 230 may be formed from any suitable processing system, such as a suitably programmed PC, Internet terminal, lap-top, or hand-held PC, and in one preferred example is either a tablet, or smart phone, or the like. Thus, in one example, the client device 230 is a standard processing system such as an Intel Architecture based processing system, which executes software applications stored on non volatile (e.g., hard disk) storage, although this is not essential. However, it will also be understood that the client devices 230 can be any electronic processing device such as a microprocessor, microchip processor, logic gate configuration, firmware optionally associated with implementing logic such as an FPGA (Field Programmable Gate Array), or any other electronic device, system or arrangement.

[0186] For the purpose of the following examples, it is assumed that one or more processing systems 210 are servers, which communicate with the client devices 230 via a communications network, or the like, depending on the particular network infrastructure available. The servers 210 typically execute applications software for performing required tasks including storing, searching and processing of data, with actions performed by the servers 210 being performed by the processor 311 in accordance with instructions stored as applications software in the memory 312 and/or input commands received from a user via the I/O device 313, or commands received from the client device 230.

[0187] It will also be assumed that the user interacts with the client device 230 via a GUI (Graphical User Interface), or the like presented on a display of the client device 230, and in one particular example via a browser application that displays webpages, or an App that displays relevant information. Actions performed by the client devices 230 are performed by the processor 331 in accordance with instructions stored as applications software in the memory 332 and/or input commands received from a user via the I/O device 333.

[0188] However, it will be appreciated that the above described configuration assumed for the purpose of the following examples is not essential, and numerous other configurations may be used. It will also be appreciated that the partitioning of functionality between the client devices 230, and the servers 210 may vary, depending on the particular implementation.

[0189] An example of the manufacturing process will now be described in more detail with reference to Figures 5A to 5C.

[0190] In this example, at step 500 one or more ownership items are acquired, typically by having representatives of a managing entity negotiate agreements with property owners, with the server being used to generate ownership item data at step 505, including an ownership item identifier associated with the respective real property and details of one or more of a purchase price, a transfer of rights to a managing entity, a right of occupancy and occupancy charge for a current property owner and a purchase price offset. The ownership item data is then stored, for example in a database 240, at step 510.

[0191] Thus, the ownership stakes are purchased by the Managing entity from suppliers (homeowners) as items of inventory, or raw material. These ownership items represent the starting material in the process, with each ownership item having a set financial value based on the specific properties they carry, with each ownership item being represented by individual static sets of data stored on a physical carrier (server).

[0192] At step 515, the server 210 extracts the ownership title elements from ownership items to create security items, with associated data being generated and stored at steps 520 and 525. Thus, ownership items are consumed in the production of security items, with these security items being assigned with certain properties with the addition of an expiration date. The security item data includes a unique security item identifier associated with the security item, and a record of the ownership item identifier associated with the underlying ownership item on which the security item is based. The security item data also includes attributes, such as the expiry date, the proportion of the respective ownership item owned, the stake type and/or the values, such as a market or other values associated with the ownership. [0193] Thus, each security item is a financial asset that carries attributes and economic value of the underlying property stake. The economic value of each security item includes two key components, namely a value, such as a market or other value, of the property stake and the value, such as a market or other value, of the occupancy charge. Each of these two components represent a fixed share in the value, such as a market or other value, of the underlying property stake. At any point in time, the value of each security item equals the current value, such as a market or other value, of the specific ownership stake it represents, so the value of the security item will increase as the value of the respective real property increases. Additionally, the unique value of each individual security item (including the property stake and occupancy charge), as component of production material, contributes to determining the total economic value of the end financial product, which consists of a face value and financial return, with the face value portion being determined by the cost of acquiring raw material, and the financial return is determined by the cumulative change in the value, such as a market or other value, of that cost.

[0194] Security items are protected by a custodial arrangement to provide additional independent oversight for the benefit of investors, with the security items providing a warranty (guarantee) of the value of the end financial products. It will be appreciated that as security items form a component of the end financial products, security items are an instrument of easily accessible investment into a large pool of properties without costs and burdens of direct ownership. As a component of the end financial products, security items are also an instrument for attracting a wide variety of investors.

[0195] The security item data includes information relating the security item back to the underlying ownership item on which the security item is based, so that each security item is traceable through the production process, from their creation from raw material, through consumption during the assembly of security pool items, and to the manufacture of end consumable financial products. In one example, this is achieved by applying blockchain technology which allows to create permanent and tamper-proof records of unique transactional data about each security item.

[0196] The specific structure of security items include a number of variations, which carries additional economic value based on the quality of each structure and its unique components, that is passed on to the end financial product. Additionally, the occupancy charge has a dynamic value as it represents a fixed share in the ownership stake, and therefore follows the value, such as a market or other value, of the property. This creates a highly probable potential for significant value increase that is passed on to the owners of the end financial products.

[0197] Security items provide portability of end financial products by removing the legal title hurdle, thus creating a high liquidity - high return financial asset. Security items, as a means of indirect ownership, add value beyond their own to the various types of investors, as they remove some common barriers for investments to residential housing. For example, foreign ownership rules are implemented to protect the pool of available residential housing to local citizens. As the end financial product has a finite life and does not allow occupancy rights to investors, there is no impact on availability of residential pool for local citizens. This also allows access to much needed foreign capital and opens an otherwise closed investment opportunity.

[0198] Each security item, being a component material of the end financial product, will contain block-chain data, which will tie security items to their respective financial product on one side and the unique ingredients of the raw materials (ownership stakes) on the other. This will also allow the end financial products to live separately from the exchange, be traded independently of the exchange and be recognisable by the exchange at maturity for collection of returns. This flexibility and independence add additional financial value to the end financial product.

[0199] Having created the security items, at step 520, the server 210 selects single or multiple security items, and uses these to create security pool items at step 535. Corresponding security pool item data is generated at step 540, including a unique security pool item identifier and security item identifiers associated with the single or multiple security items that form the security pool item, with this being stored at step 545.

[0200] Accordingly, security items are assembled into new items called security pool items, with selection of the security items being used to perform a quality control process through application of certain criteria. This ensures each security pool item is created by a single and unique assembly, allowing careful control over the properties and resulting value of each security pool item. In this regard, the specific criteria used in assembling the security pool items result in the creation of additional economic value over and above the value of the combined underlying security items, which is akin to the process of manufacturing brass from copper and zinc, where the resulting brass product acquires new properties compared to the base components of copper and zinc.

[0201] Thus, combining individual security items in the process of assembly of security pool items creates a unique blend of values and returns, thereby further enhancing the total economic value that is passed on in the process of creating of the end financial products.

[0202] At step 550, the server 210 segments the security pool items to thereby generate security pool fraction items. Corresponding security pool fraction item data is generated at step 555, including a unique security pool fraction item identifier and security pool item identifiers associated with the security pool item from which the security pool fraction items are created, with this being stored at step 560. The security pool fraction items become base component material for creating financial products. Associated financial product data is created at step 565, including a financial product identifier, a security pool fraction item identifier of the associated security pool fraction item, a security pool item identifier of the associated security pool item, and security item identifiers of the associated security items, with this being stored at step 570.

[0203] Thus, security pool items are then utilised in the bill of material and consumed in the production of financial product items by splitting the security pool items in sequence and based on the set criteria into security pool fraction items, which in turn become base component material of financial product items. Each financial product item contains its unique manufacturing history and information, which in one example is stored in an encrypted blockchain and can additionally and/or alternatively be incorporated into the financial product. The process of splitting security pool items into security pool fraction items using security pool fraction items as base component material of financial products includes application of certain criteria which results in further increase of the retail value of the financial product items over the value of the underlying security pool items and security pool fraction items through added liquidity and access to wider pool of investors, including retail investors. An example of this can be the value added in the bottling of fine spirits. Thus, this step of splitting security pool items into smaller fractions to produce end financial products adds further value and results in end financial products that provide a unique and affordable means for individual investors to access a portfolio of investments in multiple properties that carry unique sets of values, attributes and returns, which is not available elsewhere.

[0204] The new financial product items have their own unique properties that are different from the security items, security pool items and security pool fraction items, and can be marketed independently. The nature of the resulting financial product items can be such as for example debt or equity securities or a combination of these . These are the end financial product items that become a trading stock with a set expiration date.

[0205] Thus, financial product items can be issued/sold to investors at a premium which represents a trading margin of the managing entity. Financial product items can be re-sold by independent investors unlimited number of times until the product’s “expiration date”.

[0206] In one particular example, the end financial products are sold through an in-house online offering solution, which allows individual customer accounts that collect necessary information and are linked to the above system and process to facilitate dynamic performance updates in relation to the current products held by the customer, as well as predictions of future economic returns based on a custom set of algorithms.

[0207] The on-line market allows individual investors to trade and receive “live” information about their trading position and the estimate value of their investments and enables investors to easily perform multiple trades that produce desired economic outcome in a form of financial gains that can be converted into physical effect (cash) or other physical items that can be acquired from the proceeds of the trade. Financial products can also be taken out of the exchange and held independently by investors and/or could be traded outside of the exchange e.g., in an electronic wallet. Financial products then only need to be presented and verified at expiration date in order to receive financial returns.

[0208] To facilitate the above trading process, blockchain can be used to create a transactional history, which in turn adds additional economic value to the security items as it ensures the secure and specific determination of their value as a cost component. [0209] In another example, the financial products can be directly traded between first and second users, acting as a seller and buyer, and an example of this will now be described with reference to Figure 6.

[0210] In this example, at step 600, the first user acquires the financial product, for example purchasing this from an online marketplace or similar, as described above. During the purchase, the financial product is encrypted using a first encryption key belonging to the first user at step 610. This prevents third parties access the financial product, meaning the financial product is now securely owned by the first user.

[0211] At a later date, the first user decides to sell the product to a second user at step 620. To proceed with the sale, the first user decrypts the financial product using a first decryption key at step 630. The decryption and encryption keys could be the same key if a symmetric encryption approach is used, or could be different if the encryption is asymmetrical.

[0212] Having decrypted the financial product, at step 640 ownership details within the financial product could be updated, for example to record the transfer of ownership from the first user to the second user. This information could also be stored elsewhere, for example, in a blockchain or similar, to allow for independent verification of the ownership change, although this may not be required, depending on the preferred implementation.

[0213] Finally, at step 650, the financial product is encrypted using a second encryption key associated with the second user, thereby securing the financial product for the second user, and meaning the financial product can only be unlocked using a second decryption key.

[0214] It will be appreciated in this example, financial products can be transferred between multiple users, with the ultimate owner being able to realise the investment by presenting and successfully decrypting the financial product using their own decryption key.

[0215] Accordingly, the above arrangements provide a process for manufacturing financial products, based on a starting material in the form of an ownership stake in a residential real property. The resulting financial products can then be used as an investment vehicle, and can be bought and sold with economic gain, before expiration converts the financial product into a financial return. [0216] In one example, the process includes acquiring a plurality of ownership items, each ownership item being in respect of a particular residential real property and using the ownership items to generate end financial products. This is achieved by transforming ownership items into a plurality of security items, each representing a fixed proportion of a value of the respective ownership item and including unique expiry conditions of each respective ownership item. Multiple security pool items are created, each security pool item including single or multiple security items, with these then being split into a plurality of security pool fraction items. A plurality of tradable and/or transferable financial products are then created from security pool fraction items as base components, each batch of financial products have its own unique value based on the attributes of the underlying security pool fraction items.

[0217] As discussed above, the above approach is quite different to the prior art. Further differences relating to specific documents will now be discussed in more depth.

[0218] US 2019/0287195 describes equity sharing between ownerand investor, with apurpose of entering the house market (buyers) or long-term investment return (investors). In this approach ownership stakes are held through a property specific trust and equity sharing agreements. This approach is therefore a direct-specific approach that results in long-term property ownership.

[0219] Other key differences include:

• No further transformation of ownership stakes

• Security items represented by fractional ownership rights and are the end financial product

• No option to monetised full investment return in advance.

• No similar application of ownership stakes as component material

• Different terms of shared ownership and acquisition

• No similar manufacturing process of the end financial product.

• No similar tangible and physically transferable product with unique attributes including indirect-specific security claim.

• Investor has access to property information related to financial product. Current invention excludes such access.

• Ownership rights to the product require legal registration on acquisition. • No fixed life term of investment, no expiry date.

[0220] CN 108428168 is a rental investment scheme that operates through joint ownership titles (equity stakes). Ownership stakes are implemented through special contracts, leading to direct-specific security items and a long-term property ownership approach. Differences are similar to those outlined with respect to US 2019/0287195, with this additionally only being used for rental with block-chain technology only used for recording house contracts.

[0221] US 2009/0164360 describes a joint property investment approach using a residence right and investment security (equity). This is another form of direct-specific security and again requires long-term property ownership. Differences are similar to those outlined above for US 2019/0287195, with further differences including that this uses securitised items representing security claims not separable from the underlying single real estate property, different terms of property sharing and a different investment return structure.

[0222] WO 2008/103901 describes a joint investment scheme in commercial properties through tenancy-in-common title, with stocks in entities jointly investing into commercial real estate. This results in direct-specific securities, with the investment being a long or short term stock holding. Further differences include:

• Investment related to commercial properties

• Security items represented by fractional ownership rights and are the end financial product

• No similar manufacturing process of the end financial product, fully independent from property ownership rights

• Investor has access to property information related to financial product.

• No tangible and physically transferrable product

• No fixed life term of investment, no expiry date

[0223] WO 2020/236638 describes a system of managing real estate transactions through fractionalisation and tokenisation of asset ownership, using a block-chain based network of multiple franchisees issuing own tokens and subject to voting and consensus of key stakeholders. Asset token represent an ownership stake in a single item of a specific real estate, a type of equity security. This is a direct-specific security with the investment being a short or long term real -estate investment.

[0224] Differences are similar to those outlined above with respect to US 2019/0287195, along with the following additional differences:

• Transferable asset relates to an “asset token” - a digital record of full or fractional ownership of a single real estate property, i.e. equity stake, as such is a form of a legal title.

• Transferred through a smart contract transfer. Smart contract is linked to the legal ownership of the real estate asset; therefore every change of ownership requires updating of the smart contract with the asset registry.

• Asset tokens are not created from multiple fractions of multiple real estate properties, combined in a unique way.

• No multi-stage value creation for the end product

• Asset tokens (or sub-tokens) do not undergo any manufacturing process resulting in a creation of a new product with different properties and risk profiles.

• Smart contract also required to deal with rent and maintenance costs.

• Franchise model to grow the market

• Physical real estate contracts are passed to a custodian.

• A debt instrument only exists in a form of a non-tradable “sub-token”, being a loan financing the purchase of the real estate asset, it is inseparable from the master asset (asset token) and if secured, such claim extends only to one real estate item.

• All assets are issued, managed and traded in a block-chain ecosystem of various independent parties, each having to comply with a set of conditions and criteria, including voting and consensus, each party issuing their own tokens into the system. Asset tokens are subject to maintenance, management fees and management of cash flow from underlying properties

[0225] The current approach can provide a number of benefits over the art.

[0226] For example, in traditional arrangement, ownership opportunities for investors is mostly through equity - direct or indirect. Where there is no ownership for investors, a mortgage security is applied, and there is typically some form of debt exposure for homeowners, and a homeowner does not maintain clear and separate ownership of their asset.

[0227] Traditional approaches allow single or multiple partial interests (house stakes) in separate properties to be bundled and on-sold as bundles (with underlying property rights). Multiple partial interests in the same property appear as fractional shares, thus each representing individual ownership right in a single property. Whilst these can be bundled together, however, such bundles are not split further to create a ‘fraction of bundled fractions” as is the case in the above process.

[0228] Traditional approaches provide less flexibility, and more complexity in ownership transfer to and between investors, including legal costs associated with ownership transfer of title for investors. Additionally, traditional approaches do not allow variations of stake value security, as in the current process.

[0229] Throughout this specification and claims which follow, unless the context requires otherwise, the word “comprise”, and variations such as “comprises” or “comprising”, will be understood to imply the inclusion of a stated integer or group of integers or steps but not the exclusion of any other integer or group of integers. As used herein and unless otherwise stated, the term "approximately" means ±20%.

[0230] Persons skilled in the art will appreciate that numerous variations and modifications will become apparent. All such variations and modifications which become apparent to persons skilled in the art, should be considered to fall within the spirit and scope that the invention broadly appearing before described.

Claims (1)

1. THE CLAIMS DEFINING THE INVENTION ARE AS FOLLOWS:

   1) A method of manufacturing a transferable asset, the method including: a) acquiring starting materials including a plurality of ownership items, each ownership item being in respect of a particular residential real property; and, b) performing a manufacturing process to generate end financial products using the starting materials, each end financial product being a tradable and/or transferable financial product and the manufacturing process including: i) transforming ownership items into a plurality of security items, each security item representing a fixed proportion of a value of the respective ownership item and unique expiry conditions of each respective ownership item, with direct ownership element extracted; ii) creating multiple security pool items, each security pool item including single or multiple security items; iii) splitting each security pool item into a plurality of security pool fraction items; and, iv) creating plurality of tradable and/or transferable financial products from security pool fraction items as base components, each batch of financial products have its own unique value based on the attributes of the underlying security pool fraction items.

   2) A method according to claim 1, wherein each ownership item includes at least one of: a) a fixed ownership stake in a residential real property; b) an occupancy charge in a form of a separate fixed ownership stake in the same property; c) an occupancy charge renewal option in a form of an additional fixed ownership stake in the same property; d) an option to offset various additional charges against purchase price; e) unique acquisition terms that provide a facility for the investor to at least one of: i) obtain cash return on investment in advance; and ii) utilise the starting material in the production of a new financial product; and, f) a unique ownership item identifier.

   3) A method according to claim 1 or claim 2, wherein the security items have respective attributes including at least one of: a) an expiry date; b) a set of expiry conditions that may trigger early expiry date; c) a fixed proportion of value of the respective ownership item; d) a secured claim associated with the residential real property; e) an added value; f) a stake of the value in the respective ownership item; g) a fixed proportion of value of the occupancy charge associated with the respective ownership item; h) unique guaranteed terms of investment; i) unique security item identifiers; and, j) a unique security item identifier that is passed on through further manufacturing steps to the end financial product to allow for verification of at least one of a value and authenticity of the financial product.

   4) A method according to claim 3, wherein the method of transforming an ownership item into a plurality of security items includes at least one of: a) detaching any legal titles from ownership items; b) assigning new and unique properties, values and qualities; c) assigning unique security item identifiers; and, d) generating security items having different respective attributes.

   5) A method according to any one of the claims 1 to 4, wherein the method of assembly of security pool items from security items includes creating security pool items having a new set of respective attributes including at least one of: a) a unique security pool item identifier; b) new and unique properties, values and qualities including new and inherited values; c) a unique mix of security claims associated with a pool of specific residential real properties; d) guaranteed investment terms; e) a unique structure of investment returns; and, f) dynamic expiry conditions.

   6) A method according to any one of the claims 1 to 5 wherein the method of producing security pool fraction items by splitting each security pool item includes splitting each security pool item into a sequence of security pool fraction items having another set of unique attributes, each including at least one of: a) a unique security pool fraction item identifier; b) new and unique properties including new and inherited values; c) a unique mix of security claims associated with a pool of specific residential real properties; d) guaranteed investment terms; e) a unique structure of investment returns; and, f) dynamic expiry conditions.

   7) A method according to claim 6, wherein the method of producing unique end financial products includes using security pool fraction items as base components of end financial products, each end financial product having a respective allocation of the security pool fraction items.

   8) A method according to any one of the claims 1 to 7, wherein a financial product at least one of: a) is associated with an owner, and wherein the method includes trading the financial products by updating the owner of the financial product; b) is assigned with a secure and unique identifier which carries the product’s attributes and ownership rights, and wherein the method includes trading the financial products by transferring the financial product’s secure and unique identifier; c) assigned with a secure and unique identifier which carries the product’s attributes, and wherein the method includes trading the financial products by physically transferring the financial product between traders independently from the marketplace; d) is legally and physically transferable; e) represents an independently existing physical product; f) includes authenticity verification information; g) includes a unique financial product identifier; h) includes a unique financial product identifier carrying new and unique attributes, properties of substance and qualities; i) includes a patent number to ensure product’s authenticity and protection from potential infringers; j) includes a unique legal structure; k) includes a unique investment return structure; l) includes a unique security claim associated with a unique mix of fractions of specific properties; m) includes unique and dynamic expiry conditions; n) includes a high liquidity and affordability; and, o) an ability to be transferred without ownership registry.

   9) A method according to any one of the claims 1 to 8, wherein the method includes performing the manufacturing process using one or more processing devices by: a) generating starting data indicative of the plurality of ownership items; b) assigning unique item identifier to the starting data; c) storing the starting data in a data store; d) transforming the starting data to generate end financial product data indicative of the end financial products; and, e) storing the end financial product data.

   10) A method according to claim 9, wherein the method includes, in the one or more processing devices, transforming the starting data by: a) generating and storing security item data indicative of each security item using the ownership item data; b) generating and storing security pool item data indicative of each security pool item using the security item data; c) generating and storing security pool fraction item data indicative of each security pool fraction item using the security pool item data; and, d) generating and storing the end financial product data using the security pool fraction item data.

   11) A method according to claim 10, wherein the method includes, in the one or more processing devices, transforming the starting data by: a) generating and storing security item data by extracting legal titles associated with ownership item data and adding new data including unique guaranteed terms of investment, security conditions associated with ownership items, added value, unique dynamic expiry terms, assigning unique item identifier to each security item; b) generating and storing security pool item data by applying unique assembly criteria, creating new security claim structure and conditions, adding new value and attributes, assigning unique item identifier to each security pool item; c) generating and storing security pool fraction item data by splitting security pool items, creating new security claim structure and conditions, adding new value and attributes, assigning unique item identifier to each security pool fraction item; and, d) generating the end financial product data by using the security pool fraction item data as base component, adding new value, attributes and properties, assigning unique item identifier and patent identifier to each financial product and storing the end financial product data.

   12) A method according to any one of the claims 9 to 11, wherein the starting data includes ownership item data for each ownership item, and wherein the ownership item data is indicative of at least one of: a) an ownership item identifier associated with the respective real property; b) a fixed ownership right attached to the acquired ownership item; c) a purchase price; d) a stake type in the proportion of the respective real property; e) a transfer of rights to a managing entity acquiring ownership items; f) unique acquisition and ownership rights that allow for the full cash return on investment in advance; g) a unique and separate reference to each of the respective security item, security pool item, security pool fraction item and the end product; h) an occupancy charge for a property owner selling the ownership item; i) an occupancy charge renewal option for a property owner selling the ownership item; j) occupancy conditions for a property owner selling the ownership item; and, k) a purchase price offset indicative of a value of the right of occupancy.

   13)A method according to any one of the claims 9 to 12, wherein the security item data for each security item is indicative of at least one of: a) a security item identifier associated with the security item that is optionally passed on through further manufacturing steps to the end financial product to allow for verification of at least one of a value and authenticity of the financial product; b) an ownership item identifier associated with the ownership item data of the respective ownership item; and, c) security item attributes including any one or more of: i) an expiry date; ii) a combination of expiry conditions which may trigger an early expiry date; iii) a proportion of the value of the respective ownership item; iv) secured claim; v) unique guaranteed terms of investment; vi) an added value; vii)a stake type in the proportion of the value of the respective ownership item; and, viii) a value of the occupancy charge associated with the respective ownership item.

   14) A method according to any one of the claims 9 to 13, wherein the security pool item data is indicative of at least one of: a) a security pool item identifier associated with the security pool item that is optionally passed on through further manufacturing steps to the end financial product to allow for verification of at least one of a value and authenticity of the financial product; b) security item identifiers associated with the single or multiple security items; c) ownership item identifiers associated with the ownership items data of the respective ownership items; and, d) security pool item attributes including any one or more of: i) a combination of expiry dates; ii) a combination of expiry conditions which may trigger an early expiry date; iii) a proportion of the values of the respective ownership items; iv) unique secured claim being a unique mix of security claims associated with a pool of specific properties; v) unique guaranteed terms of investment; vi) an added value; vii) stake types in the proportion of the value of the respective ownership items; and, viii) values of the occupancy charge associated with the respective ownership items.

   15)A method according to any one of the claims 9 to 14, wherein the security pool fraction item data is indicative of at least one of: a) a security pool fraction item identifier associated with the security pool fraction items that is optionally passed on through further manufacturing steps to the end financial product to allow for verification of at least one of a value and authenticity of the financial product; b) security pool item identifiers associated with the security pool items; c) security item identifiers associated with the single or multiple security items; d) ownership item identifiers associated with the ownership items data of the respective ownership items; and, e) security pool fraction item attributes including any one or more of: i) a combination of expiry dates; ii) a combination of expiry conditions which may trigger an early expiry date; iii) a proportion of the values of the respective ownership items; iv) unique secured claim being a fraction of the unique mix of security claims associated with a pool of specific properties; v) unique guaranteed terms of investment; vi) an added value; vii) stake types in the proportion of the value of the respective ownership items; and, viii) values of the occupancy charge associated with the respective ownership items.

   16) A method according to any one of the claims 9 to 15, wherein the end financial product data includes financial product data for each end financial product indicative of at least one of: a) a secure and unique financial product identifier associated with the financial product that is optionally passed on through further manufacturing steps to the end financial product to allow for verification of at least one of a value and authenticity of the financial product; b) a security pool fraction item identifier indicative of a respective security pool fraction item; c) a security pool item identifier associated with the respective security pool item; d) security item identifiers associated with respective security items; e) a patent identifier; and, f) ownership item identifiers associated with the ownership items data of the respective ownership items.

   17) A method according to any one of the claims 9 to 16, wherein the method includes, in the one or more processing devices, creating and storing in a distributed data store, data that provides additional security, full audit trail and authenticity to the end financial product, including at least one of: a) details of trading of a financial product; b) starting data; c) end financial product data; d) ownership item data; e) security item data; f) security pool item data; g) security pool fraction item data; h) financial product data; i) unique and secure identifiers, providing full manufacturing audit trail, end product’s value guarantee and authenticity validation, for each of the ownership items, security items, security pool items, security pool fraction items, financial products; and, j) financial product patent identifiers representing a notice to potential infringers and a mark of product authenticity.

   18) A method according to any one of the claims 9 to 17, wherein the method includes, in the one or more processing devices, creating and storing meta data that provides additional security, full audit trail and authenticity to the end financial product, wherein the meta data: a) contains both public (visible to all) and private (visible only to the owner) information; b) is maintained independently of the processing system to allow for the asset to be transferred between systems while maintaining integrity of the meta data; c) can be created, modified and removed by the processing system currently associated with the product; and, d) includes at least one of: i) details of trading of a financial product; ii) starting data; iii) end financial product data; iv) ownership item data; v) security item data; vi) security pool item data; vii) security pool fraction item data; viii) financial product data; ix) includes unique and secure identifiers, providing full manufacturing audit trail, end product’s value guarantee and authenticity validation, for each of the ownership items, security items, security pool items, security pool fraction items, financial products; and, x) includes financial product patent identifiers representing a notice to potential infringers and a mark of product authenticity.

   19) A method according to any one of the claims 1 to 18, wherein the method includes, in the one or more processing devices, trading a financial product by at least one of: a) updating the owner details of respective financial product data; b) by transferring the unique financial product identifier between financial product buyer and seller; and, c) physically transferring the financial product between financial product buyer and seller independently from a marketplace.

   20) A method according to any one of the claims 1 to 19, wherein the method includes, physically transferring the financial product between a buyer and seller by: a) decrypting encrypted financial product data using a first decryption key associated with the seller; and, b) encrypting the financial product data using a second encryption key associated with the buyer.

   21)A method according to claim 20, wherein the method includes updating ownership information stored within the financial product.

   22) A system for generating a transferable asset, the system including one or more processing devices configured to: a) generate starting data indicative of starting material including a plurality of acquired ownership items, each ownership item being in respect of a residential real property; b) store the starting data in a data store; c) perform a manufacturing process to generate end financial products using the starting materials, each end financial product being a tradable and/or transferable financial product and the manufacturing process being performed to transform the starting data to generate end financial product data indicative of the end financial products by: i) transforming ownership items into a plurality of security items, each security item representing a fixed proportion of a value of the respective ownership item and unique expiry conditions of each respective ownership item, with direct ownership element extracted; ii) creating multiple security pool items, each security pool item including single or multiple security items; iii) splitting each security pool item into a plurality of security pool fraction items; and, iv) creating plurality of tradable and/or transferable financial products from security pool fraction items as base components, each batch of financial products have its own unique value based on the attributes of the underlying security pool fraction items; and, d) storing the end financial product data.

   23) A method of creating a transferable financial asset, the method including, in one or more processing devices and a distributed block-chain network: a) generating starting data indicative of starting material including a plurality of acquired ownership items, each ownership item being in respect of a respective real property, each item created and stored as a unique element that is subsequently added to a block chain in the production process; b) performing a batch manufacturing process to generate end financial products by creating unique block-chains of each batch, using the starting materials, to generate a tradable end financial product and the manufacturing process being performed to transform the starting data to generate end financial product data indicative of the end financial products by: i) converting each ownership item into a plurality of security items, each security item representing a fixed proportion of a value of the respective ownership item and unique expiry conditions, with a direct ownership data extracted, in a form of a new unique element of a block-chain data; and, ii) creating multiple security pool items, each security pool item consists of the batch of security items to be processed, generated from different ownership items, each security pool item created in a form of a new unique element of a block-chain data; c) splitting each security pool item into a plurality of security pool fraction items, each security pool fraction item created as a new unique element of a unique block-chain data; and, d) creating an end financial product in a form of a block-chain financial asset on the block-chain network from security pool fraction items, each end financial product is created as a new unique element of a unique block-chain data, block-chain data including a patent identifier, wherein: i) each end financial product is created as an independent transferable asset capable of existing outside of the processing system with the owner of the end financial product acquiring full and independent control; and, ii) each end financial product is capable of being traded independently of the processing system.

   24) A system of creating a transferable financial asset, the system including one or more processing devices and a distributed block-chain network configured to: a) generate starting data indicative of starting material including a plurality of acquired ownership items, each ownership item being in respect of a respective real property, each item created and stored as a unique element that is subsequently added to a block chain in the production process; b) perform a batch manufacturing process to generate end financial products by creating unique block-chains of each batch, using the starting materials, to generate a tradable end financial product and the manufacturing process being performed to transform the starting data to generate end financial product data indicative of the end financial products by: i) converting each ownership item into a plurality of security items, each security item representing a fixed proportion of a value of the respective ownership item and unique expiry conditions, with a direct ownership element extracted, in a form of a new unique element of a block-chain data; and, ii) creating multiple security pool items, each security pool item consists of the batch of security items to be processed, generated from different ownership items, each security pool item created in a form of a new unique element of a block-chain data; c) split each security pool item into a plurality of security pool fraction items, each security pool fraction item created as a new unique element of a unique block-chain data; and, d) create an end financial product in a form of a block-chain financial asset on the block- chain network from security pool fraction items, each end financial product is created as a new unique element of a unique block-chain data, block-chain data including a patent identifier, wherein: i) each end financial product is created as an independent transferable asset capable of existing outside of the processing system with the owner of the end financial product acquiring full and independent control; and, ii) each end financial product is capable of being traded independently of the processing system.

   25) A method for generating a transferable asset, the method including, in one or more processing devices: a) generating starting data indicative of starting material including a plurality of acquired ownership items, each ownership item being in respect of a residential real property; b) storing the starting data in a data store; c) performing a manufacturing process to generate end financial products using the starting materials, each end financial product being a tradable and/or transferable financial product and the manufacturing process being performed to transform the starting data to generate end financial product data indicative of the end financial products by: i) creating a plurality of security items from ownership items, each security item representing a fixed proportion of a value of the respective ownership item and unique expiry conditions of each respective ownership item, with direct ownership element extracted; ii) creating multiple security pool items, each security pool item including single or multiple security items; iii) splitting each security pool item into a plurality of security pool fraction items; and, iv) creating plurality of tradable and/or transferable financial products from security pool fraction items as base components, each batch of financial products have its own unique value based on the attributes of the underlying security pool fraction items; and, d) storing the end financial product data, wherein each element of data involved in the system is created in the form of meta data that: i) contains both public and private information; ii) is maintained independently of the processing system to allow for the asset to be transferred between systems while maintaining integrity of the meta data; and, iii) can be created, modified and removed by the processing system currently associated with the product.

   26) A system for generating a transferable asset, the system including one or more processing devices configured to: a) generate starting data indicative of starting material including a plurality of acquired ownership items, each ownership item being in respect of a residential real property; b) store the starting data in a data store; c) perform a manufacturing process to generate end financial products using the starting materials, each end financial product being a tradable and/or transferable financial product and the manufacturing process being performed to transform the starting data to generate end financial product data indicative of the end financial products by: i) creating a plurality of security items from ownership items, each security item representing a fixed proportion of a value of the respective ownership item and unique expiry conditions of each respective ownership item, with direct ownership element extracted; ii) creating multiple security pool items, each security pool item including single or multiple security items; iii) splitting each security pool item into a plurality of security pool fraction items; and, iv) creating plurality of tradable and/or transferable financial products from security pool fraction items as base components, each batch of financial products have its own unique value based on the attributes of the underlying security pool fraction items; and, d) store the end financial product data, wherein each element of data involved in the system is created in the form of meta data that: i) contains both public and private information; ii) is maintained independently of the processing system to allow for the asset to be transferred between systems while maintaining integrity of the meta data; and, iii) can be created, modified and removed by the processing system currently associated with the product.