Is tokenization of real estate ready for lift off in APAC?

Abstract

PurposeBlockchain and distributed ledger technologies are set to disrupt the real estate sector in all areas: ownership, sale, management and investment. Tokenization moves physical real estate to the digital space and could result in substantial cost savings in the pre- and post-tokenization process. This article discusses whether real estate as an asset class is ready for digitalization in the Asia-Pacific (APAC) region.Design/methodology/approachGlobally, the APAC region has the highest digital adaptation/adoption rates. Regulators in the region are also moving fast to clarify their stance on digital assets. This article adopts a holistic view, from trends, regulations, and technology, to discuss the benefits and challenges of digitalizing real estate in APAC.FindingsReal estate tokenization is a nascent market but platforms like BrickX, KASA, ADDX, and Minterest have successfully launched real estate tokens in Australia, South Korea, and Singapore, respectively. Tokenization may prove to be a viable funding source for those relatively poorly capitalized financial markets in the APAC region.Practical implicationsThis paper discusses the current regulatory and business contexts in relation to the pace of tokenization of real estate in APAC. Opportunities and difficulties are outlined in a concise manner to facilitate more discussion in this area.Originality/valueExisting reports and research articles tend to focus on the western markets. This article provides a new perspective on tokenization, specifically in the APAC context.