A month ago, RAMI in Israel published a notice asking for help from blockchain experts. They want to do more than just have digital records of land. They want to make a place where people can trade tokens that represent real estate.
Here’s what they plan to do:
- Keep records of property and manage things like licenses, transactions, and rental agreements using smart computer programs.
- Turn real estate into tokens, which means you can buy, sell, rent, invest, and share profits using these digital tokens.
- Create a platform where people can trade these tokens and get paid for it.
Last year, a group called the Boston Consulting Group said that by 2030, we could have more than $16 trillion in tokenized assets, and almost 20% of that might be in real estate. Japan is already pretty good at this, especially with real estate digital tokens.
Tokenized real estate is different from something called real estate investment trusts (REITs), which are usually about a bunch of properties together. Tokenization often focuses on one property, like a house or an apartment building.
One big advantage of tokenization is that it lets you invest in a small part of something expensive, like a house, which you might not be able to afford entirely. On the flip side, more people can invest in it, which can make it easier to buy or sell.
Blockchain is famous for cutting out the middleman, like banks or brokers. But, be careful because there might still be steps to make sure you’re not getting tricked when you buy tokens. There are lots of scams in the cryptocurrency world, and it’s risky to buy tokenized property from a company you don’t know. In Japan, most of the time, big trust banks are involved, which makes it more trustworthy. Real estate needs a trusted middleman to connect the physical world of buildings with the digital world of tokens.
In Israel, it makes sense for the land authority to run the platform for trading tokens because they can confirm the details about the property behind each token. Blockchain can be useful even without tokenization. It can work as a digital land registry, which is like a digital record of who owns what land. It won’t stop all corruption, but it makes it harder for others to change things without getting caught.
In the UK, a company called Coadjute uses blockchain for the property sale process. It makes it more transparent for everyone involved when buying or selling property.
We didn’t talk about all the details of the Israeli tender, but they might want to do something similar to what Coadjute does.
If you’re interested in helping with this project in Israel, you can still apply, but you need to be an Israeli company.
Image Source: https://coingeek.com/israel-land-registry-explores-real-estate-tokenization/-