Real Estate Leads Securitized Blockchain Assets in 2022 — Report

Real estate is an asset class that is ripe for integration with blockchain technology. Security tokens cover many categories but are dominated by real estate. The Coin-Crypto Research Terminal hosts a 33-page report from Security Token Market, a data and media company, that covers the current state of real estate security tokens and the potential for further adoption.

If you represent a real estate company or have a portfolio that includes real estate, this report provides the information you need to know about this evolving industry shift.

Click here to buy the full report, complete with charts and infographics.

Blockchain is changing the real estate industry

Nonfungible tokens (NFT) have been booming in popularity in recent years and have really skyrocketed to new heights in 2021. Some of the negative press about NFTs is that they are only used for pixelated images from JPEGs and have no “real world” applications. Those familiar with the blockchain and crypto space know that the use of NFTs goes way beyond pixelated monkeys and Shiba Inu memes.

The report takes a closer look at the use of blockchain projects that currently symbolize real estate. The report provides a general overview of the current state of the primary tokenized real estate market, 14 active projects operating in this space, and how these real estate tokens are traded in secondary markets.

The perfect application of blockchain technology

Security token use spans a wide variety of industries from fine art, wine and insurance, but none are growing as fast as the real estate industry, which accounts for 89% of all security tokens traded. Breaking down that 89% further, residential real estate makes up 87%, while commercial takes up just 2% of what’s handled as a security token. The global real estate market in 2021 was round $3.38 trillionand with the rise of various applications leveraging blockchain technology, it is no surprise that the crypto revolution would make its way into real estate.

Title and ownership is well suited to blockchain applications, as triple-ledger accounting (who sold, who bought, and signatures) is built directly into the systems that make up the exchange process. The verifiability and reliability of the technology make it ideal for removing many different barriers to transactions that plague the traditional real estate space.

An example is title seekers and the process of insuring them. It takes both time and money for mortgage lenders and buyers to search for a title to ensure that the seller has the legal ability to transfer ownership rights to the buyer. With a tokenized property asset, this becomes a simple task to perform a blockchain search. This is just the tip of the real estate token iceberg. Buy the report for more information.

Budding and emerging, but growing

In 2019, the first property was minted as an ERC-20 token on the Ethereum blockchain. While it may seem like a slow start, it should be noted that the real estate industry is highly regulated. Combine this factor with the growing decentralized blockchain industry and you have a recipe for slow growth – at least initially.

The report explains that the volume of actively traded real estate tokens increased by 107% in volume in 2021 compared to the previous year. Active projects span several facets including commercial hotels, private estates, section 8 and affordable housing, purchase interests through a blockchain IRA account, and insurance. As can be seen in the chart below, the majority of activity is strongly on the residential side as opposed to commercial.

The tokenization process adds an element of liquidity to the real estate market, which has been a known problem for the industry in the past. Investors can also take advantage of this by looking at generating returns with different fractionation of ownership on the blockchain, eliminating complicated and expensive barriers to entry.

Real estate on the blockchain is coming soon

The Security Token Market real estate report is critical for serious investors to read. Both past users and those not aware of this sea change can benefit from staying abreast of the latest developments mentioned in this report. All industries change, and real estate is no exception. Anyone involved in real estate will benefit from the insights this report provides to maintain their competitive advantage in the market.

This article is for informational purposes only and does not constitute investment advice, investment analysis, or an invitation to buy or sell financial instruments. In particular, the document is not a substitute for individual investment or other advice.

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