Behind the digital transformation of the economy and the rise of the Artificial intelligence Applied to business, there is a parallel phenomenon that determines a new form of financing of all productive activities.
It is about the asset tokenization, that works like new fuel of the digital economy. A way of paying and financing that, although related to the emergence of cryptocurrencies, has a more direct anchoring in the real economy with which it provides feedback.
The tokenization market has been growing at a rapid pace and has enormous potential to continue on that path. All experts on the subject agree on this, although Some of the projections they handle are disparate.
A study conducted by Blockchain Capital indicates that Tokenized assets will reach a market value of more than 1.4 trillion dollars by 2025.
On the other hand, the global consulting firm McKinsey & Company went a step further: it estimated in a recent report that this market will reach US$4 trillion in 2030.
Meanwhile, Boston Consulting Group estimated that the real estate tokenization market will reach $2.7 billion in 2022 and predicts that will reach US$16 billion by 2030.
While all sectors of the real economy are being tokenized, The real estate sector is in the midst of a unique revolution in its way of operating that is completely changing the way in which real estate is invested.
Digital transformation in the real estate market
“Digitization has permeated all economic sectors, and the real estate sector is no exception. Tokenization, a process that converts rights to physical assets into digital tokens that can be managed on the blockchainis projected for Capture 65% of real estate investments by 2025. This change not only affects the way capital is invested, but also redefines the structures of ownership and asset management,” he explained to Scope Adrian SirioCEO of the platform Ettios.io, which is dedicated to the tokenization of assets in various sectors.
“Tokenization facilitates the entry of new investors to the market, breaking barriers that previously seemed insurmountable. With tokens, fractions of properties can be ownedwhich previously required considerable sums of capital,” he added.
Syrian highlights a study by MarketsandMarkets According to which, the liquidity of the real estate market will experience exponential growth, since tokens can be bought and sold quickly on secondary markets, demonstrating that the transformation promised by tokenization goes beyond simple investment.
“This liquidity improves not only the efficiency of the market, but also its transparency and accessibility”says the expert.
However, the tokenization of this sector is still has pending challenges. One of them is Regulation on digital assetswhich varies from country to country, ranging from hostile regulation to cases of complete legal vacuum.
Based on an analysis of the Brookings Institution On the regulation of tokenization, Sirio warns that “the selection of the correct jurisdiction for each operation It is crucialas digital asset laws vary dramatically from country to country.”
Another challenge to be solved is transaction security on the blockchain platform, which must ensure the integrity of the tokens and the protection of user data. The cybersecurity firm Cybersecurity Ventures notes in a report that tokenization platforms must be equipped to combat emerging threats that could compromise digital assets.
Towards a more flexible and participatory business model
Beyond the technical and legal aspects, tokenization has a transformative potential in the real estate business model. “We are seeing an evolution towards more flexible and participatory modelswhere the investor community can have a more active role in asset management,” explains Sirio.
The expert maintains that this characteristic is in line with the view of the global consultancy firm. Deloitte on the future of ownership, which predicts a trend towards “more democratized and collectively managed” ownership structures.
Tokenization is not only changing how property is bought and sold, but also how property is conceptualized. In the not-too-distant future, It may be common to talk about buying ‘parts’ of buildings or developments, not unlike buying shares in a companyThis fundamental shift is supported by increasing technological adoption and greater cultural acceptance towards alternative investments.
Thus, while tokenization is shaping up to be a disruptive change in the real estate sectorits success will depend on the collaboration between regulators, developers and the financial market to overcome technical and legal challenges. With the right framework, this innovation has the potential to offer a more inclusive, liquid and efficient market for investors of all levels.
Source: Ambito
I am Pierce Boyd, a driven and ambitious professional working in the news industry. I have been writing for 24 Hours Worlds for over five years, specializing in sports section coverage. During my tenure at the publication, I have built an impressive portfolio of articles that has earned me a reputation as an experienced journalist and content creator.
