Many crypto leaders are wrong about the value of tokenizing real estate. They often focus only on liquidity, but tokenization offers much more. It can open the door to wider access, reduce inefficiencies, and create new opportunities for wealth.
Real estate is the world’s largest asset class, worth over $650 trillion this year. Yet, some say it is not a good fit for tokenization. This misses the real benefits. The current process of buying property is slow and costly.
It can take weeks, with extra fees and long waits, especially when buying across borders. Tokenization can fix these problems with smart contracts that automate checks, payments, and reduce fraud.
Critics say investors want liquidity like Bitcoin’s. But most everyday people want access. Today, investing in big properties often means needing a lot of money, special investor status, and locking funds for years. This blocks teachers, nurses, and middle-class families from joining in.
Tokenization breaks properties into small parts, letting anyone invest with just $100 and earn income from rents. Although trading these tokens on secondary markets is new and less liquid, the demand to join is huge.
Some argue tokenization doesn’t represent ownership well. But blockchain lets investors buy small shares of big projects securely and transparently. For example, a $50 million property can be split into 500,000 tokens, each earning income and gains. This lowers entry barriers and offers control not found in traditional real estate investment trusts (REITs).
The real challenge isn’t technology but old regulations and existing business models resisting change. However, governments like the UAE are pushing forward, starting projects to tokenize billions in real estate.
Big companies like BlackRock and UBS are launching tokenized investment funds. Each new participant makes the market stronger and more connected, helping others join in more easily. New marketplaces for real-world assets are developing, and clearer rules are coming, paving the way for mass adoption.
For decades, only wealthy institutions could invest in top real estate deals. Tokenization changes that. It allows anyone to build a diverse property portfolio across regions and types. Crypto leaders who focus just on liquidity miss this bigger picture. Real estate tokenization is about making wealth creation accessible to all.
In the end, tokenized real estate will grow despite skeptics, unlocking a new era of investment for everyone.
Opinion by Darren Carvalho, Co-Founder and Co-CEO of MetaWealth.
