Mid-Week Update - Oct. 11th

Real Estate Tokenization

Author

Michael Blake
October 11, 2023

Mid-Week Update - Oct. 11th

Top News Headlines

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  • Israel has frozen crypto accounts belonging to Hamas, with Binance helping to locate them - Read More

Top Crypto Prices by Market Cap.

1. Bitcoin $26,804.39 7D -3.3%
2. Ethereum $1,559.70 7D -5.3%
3. BNB $205.36 7D -3.7%
4. XRP $0.485 7D -8.2%
5. Solana $21.65 7D -7.5%

6. Cardano $0.246 7D -4.8%
7. Dogecoin $0.058 7D -5.3%
8. TRON $0.086 7D -2.7%
9. Toncoin $1.99 7D 1.9%
10. Polygon $0.511 7D -8.9%

Source: Coingecko Price Feed, Oct. 11th 2023, 10:30pm EST. Data excludes Lido Staked Ether, and stablecoins USDC and USDT.

Spotlight: Real-Estate Tokenization

In 2021, the global real-estate market was valued at over $300 trillion dollars, making it one of the largest markets in the world. Almost everyone on earth is connected to the real-estate market in some way, as a renter/owner, or worker in a retail, office or factory.

Real-estate however remains highly illiquid, inaccessible, and relatively inefficient to manage compared to other asset classes. With commercial property prices in free fall around the world, and interest rates continuing to rise, real estate companies are desperate for new revenue opportunities.

Hudson Yards, NYC pictured on Dec. 4, 2018. Photo by Tim Clary via Getty Images

So what is Tokenization and how can it make an impact?

Simply put, tokenized real-estate is when a property or its cash flows are represented as a blockchain token (or tokens). An easy example would be representing a single property as an NFT, or Non-Fungible Token, which could then be bought, transferred or sold directly on a blockchain marketplace.

Another great example would be fractionalized real-estate:

In this example outlined by Chainlink, tokenization enables fractional ownership of a property where individual tokens can represent a specific percentage of ownership over the property, and therefore a claim to a percentage of the property’s cash flows.

Although technical challenges still exist, tokenization is shaping up to be one of the next major trends in real-estate by offering investors and property owners benefits like increased liquidity, better price discovery, lower costs and increased transparency.

That’s it for the Mid-Week Update by DAI! If you found this useful, please share and recommend! Thanks for reading!

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