Real Estate on the Blockchain: The Trillion Dollar Opportunity Going Unnoticed!

Buy property like crypto. Tokenization turns real estate into 24/7, tradable, digital assets — no agents, no borders, no big checks.

Ashwin Francis

and

Raghav Mehra

Jul 03, 2025

🧩Why Real Estate Is the World’s Largest Illiquid Asset

Real estate is the most valuable asset class on the planet, estimated to be over $300 trillion globally. So why does it remain frustratingly out of reach for most people? Whether it’s a residential building in Madrid or a co-working space in Bangalore, buying property typically involves several constraints, like:

Huge capital outlay with bulky payments required upfront
Complex legal procedures involving lawyers, paperwork, and bureaucracy
Limited access for retail and non-institutional investors
Illiquidity with extremely slow market transactions
Policy hurdles and geographic restrictions that make cross-border investments a regulatory minefield

A popular option, like REITs (Real Estate Investment Trusts), also offers only indirect exposure to owning real estate with limited scope of customization. High-growth commercial or luxury real estate often enjoys exclusive ownership by institutions, developers, or ultra-wealthy individuals with little to no participation by retail investors.

💡 The Opportunity

Tokenization tackles this problem. By breaking down real estate into digital tokens, it makes it possible to:

Own a fraction of a property (e.g. 0.1% of a building)
Buy and sell real estate tokens instantly with decision-making at your fingertips
Earn rental income and yield on properties offered through smart contracts
Access the housing market globally, not just in your region

Just like electronic ownership of stocks made it possible to move from paper certificates to dematerialized accounts, real estate is witnessing a similar revolution. And this revolution is being powered by blockchain.

⚒️How Real Estate Tokenization works?

Imagine splitting up your apartment into ‘shares’, where each share (or ‘token’ in this context) represents a pro-rata claim to the property. For example, a AED 1 million property can now be split into 1000 shares worth AED 1,000. You can now sell fractions of your property portfolio and create more liquidity in the real estate markets.

This is beneficial for both investors and Developers:

Investors:

Buy tokens in affordable chunks
Sell tokens in secondary markets and ensure investments are more liquid than traditional real estate investments
Get a proportional vote in key decisions affecting your portfolio through smart contracts
Instant settlement of cash through stablecoin implementation

Developers:

Raise funds for development projects through the primary market offering of tokens
Get instant settlement of cash through stablecoin implementation

Here, there are two markets in play

Primary Market: Where new tokens are sold to investors, projects can now get more accurate valuations driven by investor demand and project fundamentals
Secondary Market: Investors can engage in token trading activities where they are able to buy and sell tokens with relative speed and ease. This drives one of the key benefits of the tokenization model, which is creating liquidity in the real estate market

⚙️The Tech Behind Tokenized Property

All this magic is driven by Blockchain, a secure digital ledger that records every transaction while maintaining transparency and immutability. Two key systems are part of the architecture:

Smart Contracts: A digital agreement that handles rent disbursals, equitable voting on property decisions, compliance, and regulatory requirements, etc. Limiting operational overheads required to run the program
Platforms: Most current tokenization projects are built on Ethereum, which hosts the smart contracts that are deployed directly on the Ethereum blockchain, while Polygon acts like the turbocharger, making transactions faster (over 7,000 transactions per second) and much cheaper ($0.01 vs. $20 per transaction)

Smart contracts can’t check the latest property prices through popular listing sites. That’s where ‘Oracles’ come in; they act like digital messengers that provide live data feeds into the blockchain. By implementing AI powered algorithms, investors can get updated property valuations based on market data

🪙Stablecoins: Your Shield Against Crypto Volatility

Stablecoins (like USDC or USDT) are digital currencies that are designed to have a near-perfect peg to a fiat currency in circulation

No surprises: Your €100,000 investment stays €100,000 from start to finish. No more pesky price revaluations at checkout!
Lightning-fast settlements: Deals close in minutes and not weeks, you can thank smart contracts for the heavy lifting
Lower costs: Converting £10,000 to USDC costs roughly 60% less than traditional banks, with crypto costing just 27% of what banks charge
Borderless investing: Buy property tokens from London, Riyadh, or Singapore with no currency headaches or banking barriers

🌍 Tokenized Towers & Blockchain-Savvy Governments

Tokenized real estate is having some groundbreaking applications, from both startups and governments. We are seeing buildings turning into blockchain-based assets as enterprises experiment with digitally tradable property.

🏢 Pioneering Companies

RealT: Based in the US, RealT leverages DeFi on the blockchain to allow investors to take fully-compliant, fractional, and tokenized ownership of rental homes starting from just $50. One can receive weekly rental payouts in stablecoins like USDC, governed by smart contracts.
Propy: Operating as a Web3 project since 2017, Propy AI allows for deed and documentation in real estate to be encoded in smart contracts and uses blockchain to close transactions with enhanced security and transparency.
Lofty AI: Focused on U.S. single-family homes, Lofty AI offers instant liquidity, allowing users to buy and sell property tokens on the platform
Brickblock and Smartlands: Targeting commercial and institutional real estate, these platforms allow developers to tokenize multi-million dollar properties and raise capital globally.

🏛 Governments Getting Involved

Dubai Land Development (DLD): With its pioneer project Real Estate Evolution Space Initiative (REES), DLD has become the first real estate registration entity in the Middle-East to adopt blockchain-based tokenization, enabling fractional ownership and shaping a more inclusive real estate market.
Switzerland: Zug in Switzerland is often referred to as the “Crypto Valley” for its high concentration of blockchain companies. The country has clear regulatory framework for blockchain and crypto ventures, encouraging innovation while ensuring compliance.
Asia-Pacific region: Regulators in Japan and Singapore have streamlined registry and approval processes, allowing tokenized projects to go live in weeks instead of months. Government-backed blockchain sandboxes in Thailand and Indonesia are financing pilot tokenization schemes for residential and hospitality assets.

These aren’t just pilot projects anymore- they are creating pipelines for properties to trade like crypto- fast, borderless, and democratized.

🙌Why This Changes Everything

Real estate tokenization represents a fundamental change to real estate investing and democratizes access to a previously exclusive asset class.

Invest in real estate as per your budget: Buy a slice of prime real estate while commuting to work on the metro. Invest in as many tokens as your investment budget allows
Easier access to financing for developers: Developers can now crowdfund projects globally, tapping into both institutional, qualified, and retail investors, instead of relying solely on the banking sector
Global Portfolio: Build your dream real estate portfolio across Paris, Madrid, and Dubai from your living room. Digital platforms eliminate traditional barriers while smart compliance systems handle regulatory requirements seamlessly across jurisdictions.

The Big Three: Transparency, Security, Speed

Every transaction is recorded on an immutable and public ledger without any hidden fees or backroom deals
Smart contracts enforce regulatory and compliance rules, ensuring that trust and security are baked into the program
You’re no longer forced into the slow lane for real estate deals; you can now buy/ sell tokens in liquid secondary markets with trade settlement times nearing real-time.