Blockchain technology is changing the financial landscape. Sectors such as banking, finance, and lending have already been majorly transformed by the DeFi revolution led by platforms such as Ethereum and Binance Smart Chain. The next major disruption will occur with real-world assets and commodities.
The concept of asset tokenization allows for the exchange of real-world asset securities directly on the blockchain, with real estate leading the charge.
Asset Tokenization is the process by which the ownership of real estate assets is represented by tokens. Each real estate asset is held in its own company whose shares are represented by tokens on the blockchain.
By holding these tokens, you own a share of the legal entity, and by extension, the property itself. Each tokenized property is rented out to tenants, generating a monthly rental yield.
This allows for a global, fractional model of real estate ownership conducted entirely on-chain. Asset Tokens can then be bought and sold, turning real estate into a fully liquid asset.