The process of converting traditional equity holdings into digital shares is known as tokenization. These blockchain-based digital tokens enable investors to see detailed information about their holdings and to buy, sell, and transfer private assets over the smart contracts.
The end goal and most value-added of digital securities is to create liquidity on private assets. A transferable digital share is created by converting traditional real estate equity into security tokens. This makes it possible for investors to buy and sell on the Secondary Market with a larger pool of potential buyers. Collateralized borrowing against tokenized equities can also provide liquidity. Tokenization is an additive process that creates new liquidity pathways while maintaining traditional capital flow methods.
The tokenization of real estate property, one of the principal use cases of blockchain in real estate, has yielded tremendous results. It helps asset and fund owners raise their capital more efficiently and provides investors with almost unlimited access to private real estate investments, along with better liquidity, greater transparency, and other eye-catching benefits. The global real estate market is expected to reach $8,662.2 million by 2026, according to the report “Real Estate Market by Property and Business: Opportunity Analysis and Industry Forecast, 2019–2026. It is one of the fastest growing industries and has shown noteworthy profits in recent years. As a result, major platforms are moving towards incorporating real estate investment into their blockchain-based platforms.
The digital asset model has numerous advantages over REITs. The primary benefits are as follows: Token holders trade at a discount to the asset’s net asset value (NAV) compared to a REIT. Tokenization enables the trading of single assets and private issuances. Cost-effectiveness and accessibility are improved by digital processes
The trading of security tokens is regulated. To offer legal security trading, the exchange must fully comply with regulations, and investors may be required to meet certain qualifications and pass the KYC check to verify their identity and accredited status. The security token market operates on regulated exchanges for all these reasons. MAMI security tokens are listed on regulated exchange like Cryptosx.
