Trump has won US elections, and with his second term comes a golden age for crypto, with positive regulations and unlimited opportunities. Bitcoin has already touched $91K in jubilation, with a brand new bull run already on the road. Altcoins are not behind either; in fact, CoinGecko’s 2024 Q3 crypto industry report highlighted RWA, memecoins, and more as the most popular crypto narratives!

RWA or real estate tokenization has had a good run in 2024, setting the sector up as one to see tremendous growth in this decade. A recent Tren Finance research report even predicts a 50x growth for RWA tokenization by 2030.

Out of the most popular RWAs to be tokenized this far, real estate is up there. A traditionally illiquid market now turned liquid by RWA tokenization, real estate tokenization is quickly gaining traction. 

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The hype surrounding RWA tokenization

RWA tokenization refers to the process of converting ownership over real-world assets (RWAs) like real estate, art, commodities, or financial instruments like bonds or equities into digital tokens on a blockchain. One asset can be turned into one or a series of blockchain-based tokens, so an asset can essentially be purchased by multiple investors. This makes certain markets previously only accessible to HNIs and enterprises more accessible and liquid, lowering entry barriers for novice investors.

Each RWA token can represent complete or fractional ownership of an underlying asset, allowing it to be traded, transferred, or held digitally.

Multiple perks to RWA tokenization make the sector so popular to RWA owners and crypto investors alike. Some of them are:

• Accessibility: As just mentioned, tokenization lowers the barriers to entry for investing in high-value assets with the feature of fractional ownership. For example, having a stake in a high-value real estate property becomes possible for retail investors with RWA tokenization.
• Liquidity: Traditional RWAs often suffer from illiquidity; if you take real estate as an example again, assets are inaccessible to buyers due to geographical and economic reasons. However, tokenized assets can be traded quickly and 24/7 from any part of the world, and fractional ownership allows people from all financial backgrounds to enter any market, significantly enhancing liquidity.
• Cost efficiency: By eliminating intermediaries and streamlining all processes, RWA tokenization reduces costs related to asset management, transaction fees, and regulatory compliance.
• Global reach: Blockchain enables RWA to be marketed and traded globally, increasing both investor pool and market efficiency.
• Lower risk than typical crypto: Many traditional investors stay wary of your usual crypto due to their speculative nature; their value is derived from market supply and demand instead of any underlying asset. RWA tokenization solves this issue for such investors, bringing real-world value to the blockchain. This expands the utilities of crypto, birthing innovative use cases that bridge the physical and digital economies. 

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What’s more, the use cases of RWA tokenization are vast. You can choose to tokenize everything from real estate to debt instruments to art/collectibles to commodities, making RWA a cornerstone of the DeFi movement.

RWA sector to grow 50-fold in six years?

As Tren Finance’s October 2024 report stated, predictions from some of the largest financial institutions and business consulting firms suggest a 50x growth for RWA by 2030. 

Further forecasts say that the RWA sector could reach a market size between $4 trillion and $30 trillion, as you can see in the image below. 

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If the sector reaches even $10 trillion by 2030, that would be a 54-times growth from its current value of $187 billion. 

As Tren Finance further captured in the report, the global RWA market stands at $867 trillion, only a small portion of which currently exists on-chain:

As the RWA tokenization sector matures, it is expected to capture more of this untapped market. 

What else does the Tren Finance report note? Here’s a quick summary:

• McKinsey & Company expects a $4 trillion market valuation for RWA by 2030, while Standard Chartered expects $30.1 trillion.
• The tokenized market excluding stablecoins is valued at $11.6 billion.
• Including stablecoins, the tokenized market holds a valuation of $170 billion. In contrast, private credit holds $9 billion, real estate has $3.8 billion, securities and Treasuries have $2.2 billion, commodities have $1 billion, and ReFi, collectibles, intellectual property, and others have respectively $150 million, $60 million, $50 million, and $130 million+.
• 2024 has seen the highest amount of RWAs brought on-chain in history.
• The RWA ecosystem is dominated by BlackRock in tokenized Treasuries and securities, Tether Gold in commodities, and Landshare in real estate among others, as per the report. 

As blockchain continues integrating with TradFi, the financial markets are going through a revolution. Big players like BlackRock and Tether are expanding into RWA tokenization; the sector most definitely has the potential to completely change how people invest/trade and own assets. 

Real estate tokenization running ahead 

Out of all the different RWA being tokenized, real estate tokenization has probably caught on the fastest. Why is that? Here’s what Landshare thinks:

• Real estate properties are typically high-value and illiquid, making them super ideal for fractionalization through tokenization. By breaking down ownership of real estate into smaller, easily tradable tokens, all sorts of investors can participate in the market without needing large capital. For example, on Landshare, investors can enter the US real estate market with only $50 as a threshold.
• Real estate is a universally recognized asset class with historically stable returns and good appreciation potential. Add to that the universal market for real estate prepared by tokenization, and investors are naturally attracted to the asset.
• Blockchain’s ability to provide immutable ownership records and eliminate intermediaries addresses trust and fraud issues usually rampant in traditional real estate transactions.
• Traditional real estate transactions further involve high costs and lengthy settlement periods. Tokenization simplifies and accelerates both processes, making real estate significantly more attractive.

Overall, real estate’s vast, underutilized potential combined with blockchain’s efficiency creates a perfect use case, naturally making it a frontrunner in the RWA tokenization space.

Landshare is a U.S.-based platform dedicated to the tokenization of real estate properties. It enables investors to acquire fractional shares in residential properties using blockchain technology, streamlining the investment process and broadening the scope of who can invest in real estate. By integrating blockchain technology into the real estate market, Landshare offers tokenized property assets on its platform, making it possible for investments to start at just $50, thus democratizing the entry into property investment.

The platform employs Real World Asset (LSRWA) tokens, granting investors partial ownership in tangible property assets and marking a notable innovation in real estate investment. Landshare's utility token, LAND, has proven its transactional effectiveness by facilitating the sale of four tokenized properties on the Binance Smart Chain (BSC), demonstrating its market readiness. Addressing the traditional inefficiencies and liquidity issues in real estate, Landshare positions itself as a critical player, offering promising prospects for growth and passive income generation.

Learn more about us on our official website.

The most exciting part of the crypto and blockchain space is that it doesn’t limit itself to one sector alone; instead, it offers endless opportunities for investors. We’re now in a world where anyone can invest in real estate, art, infrastructure, or even financial services as easily as they would in cryptocurrency. Consider the DeFi, RWA, and DePIN sectors, for instance.

While RWA bridges the gap between physical assets and blockchain, DeFi redefines financial services with transparent, permissionless protocols, and DePIN promises to decentralize physical infrastructure for widespread, open access. But what makes them different and which of these innovations holds the most promise for shaping our financial future?

In this article, we’ll explore RWA, DeFi, and DePIN, examining how each could change the way we interact with digital assets, financial services, and physical spaces in a world that’s becoming increasingly decentralized.

‍Decentralized Physical Infrastructure Networks (DePIN)

Decentralized Physical Infrastructure Networks (DePIN) is emerging concept which 

uses blockchain technology to establish and manage physical infrastructure through decentralized, permissionless networks. These include cloud services, sensor networks, wireless networks, mobility, and energy networks. Unlike traditional infrastructure networks, which often rely on central authorities and are slow and costly to scale, DePIN leverages blockchain to enable community-driven infrastructure development.

At its core, DePIN focuses on developing decentralized connectivity-sharing platforms for IoT and cellular devices. The DePIN market has surged by 400%, reaching $20 billion, with fundraising volume up 296% year-over-year, according to Messari.

Moreover, DePIN networks incentivize individuals to contribute to the bootstrapping phase of growth without relying on outside resources. Through token-based rewards, individuals can help build infrastructure without needing centralized operators. This approach addresses the challenges that traditional, centralized infrastructure—often operated by large corporations—faces in terms of high costs and significant time investment. DePIN aims to empower individuals and communities to build networks faster and more efficiently.

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Real-World Assets (RWA) 

Real-World Assets (RWA) focuses on tokenizing high-value assets, making them accessible to a broader audience that was previously limited to high-net-worth individuals. With a market cap of $7.87 billion, the RWA sector is gaining momentum, projected to reach $16 trillion by 2030, according to the Boston Consulting Group.

Imagine owning a fraction of high-value assets like real estate, art, or even government bonds—all through digital tokens. This is the promise of tokenizing traditional assets, one of the most promising innovations in the crypto industry. By converting physical assets into digital tokens, people gain access to investment opportunities once exclusive to high-net-worth individuals.

The RWA sector, particularly real estate tokenization, is gaining traction as property prices rise and accessibility becomes a concern. Projects like Landshares are making property investment more efficient, liquid, affordable, and viable. According to KPMG, tokenization is ideal for single or small portfolios of assets, due to reduced time and cost associated with fractional ownership and secondary trading.

With projects like Landshares, fractional property ownership reduces entry barriers and can drive up property values by increasing bids for ownership stakes. Additionally, asset tokenization is borderless, allowing property owners to list properties on platforms accessible to investors worldwide. This creates a global pool of investors, with platforms ensuring transparency, trust, and security through blockchain technology. Tokenized real estate platforms offer liquidity, enabling property owners to sell tokens in the secondary market with ease.

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Decentralized Applications ( DeFi)

DeFi, based on peer-to-peer concepts and smart contracts on blockchain, democratizes finance by removing intermediaries like banks and brokerages. The DeFi market, currently valued at $46.61 billion in 2024, is projected to grow to $78.47 billion by 2029, with a CAGR of 10.98%.

Decentralized Finance, or DeFi, builds a financial ecosystem on top of blockchain technology. While traditional finance relies on intermediaries like banks, DeFi operates in a decentralized manner, providing financial services without intermediaries. Through smart contracts and decentralized applications (DApps), DeFi offers a range of financial activities including trading, lending, borrowing, and earning.

Projects like Aave and Compound, for instance, enable users to lend assets for interest or borrow by offering collateral. Decentralized exchanges like Uniswap allow trustless, wallet-to-wallet trading. Additionally, yield farming incentivizes liquidity provision to DeFi protocols in exchange for rewards.

DeFi provides a borderless, transparent, and accessible financial system, empowering individuals to manage their finances independently and challenging traditional finance models.

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Difference between RWA, DePIN and DeFi.

Although RWAs, DePIN, and DeFi each bridge blockchain technology with real-world applications, they serve distinct purposes and operate in unique ways. While RWA operates within the financial sector, focusing on tangible assets like real estate, gold, or art that are tokenized to represent fractional ownership, DePIN, in contrast, emphasizes decentralized infrastructure, incentivizing participants to contribute to physical network development such as data storage, wireless, and energy networks without centralized control. On the other hand, DeFi reimagines financial services by eliminating intermediaries, allowing users to lend, borrow, and trade through permissionless protocols and smart contracts. 

While RWA tokens can be bought, sold, and traded among authorized investors, democratizing access to high-value assets while adhering to regulatory standards. The DiPIN model fosters a community-driven approach, prioritizing participation and shared responsibility over traditional ownership. The DeFi sector transforms financial access by creating a transparent, autonomous, and inclusive ecosystem for users worldwide.

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Conclusion

As blockchain technology advances, the combined potential of RWAs, DeFi, and DePIN could play a crucial role in driving the next wave of decentralization. With strong growth projections, RWAs anticipated to reach $16 trillion by 2030, DePIN experiencing a 400% surge, and DeFi continuing to reshape financial services, these sectors are transforming the investment landscape. Together, RWA, DePIN, and DeFi offer promising pathways for the future, positioning them as standout areas in the evolving crypto ecosystem.

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Tokenization has brought unprecedented changes across industries but it is more effective within the real estate sector. Although there is widespread discussion about how it opened varied opportunities for investors, the offerings and benefits extend further. The discussion is largely focused on how tokenized real estate helps investors but it is equally, or perhaps more important for property owners. 

As a property owner, you must be looking for ways to maximize the profitability of your real estate assets. With the real estate tokenization, which is possible due to blockchain technology, the goal is certainly achievable. Converting your property into digital tokens to make them easily tradable and manageable on the blockchain opens up new avenues for you to increase profits. 

Let’s take a look at the strategies how you can apply and effectively boost your profits. 

Understanding Real Estate Tokenization 

Real estate tokenization involves creating digital tokens that represent ownership stakes in your property. These tokens are created and stored on blockchains that make their transactions easier, secure and transparent. Tokenization allows fractional ownership of property that further makes the property investment and trade more accessible. 

There are multiple benefits of real estate tokenization including enhanced liquidity, increased transparency, access to a broader investor base, and international access among others. In addition, property management and raising capital against real estate property becomes hassle-free. 

All these benefits make it easier for investors to enter the real estate market who found it difficult earlier. Where investors take advantage of benefits, property owners can also utilize these features and capitalize on them. 

Attract More Investors With Fractional Ownership

One of the most talked about features of real estate tokenization is fractional ownership. You can sell smaller shares of your property to a larger number of investors. It attracts investors with a small budget to take part in real estate investment. 

Tokenization started the retailing of real estate properties making it in reach of low-income group investors. It significantly increases the pool of potential buyers, making your property more attractive. 

Benefits of Fractional Ownership

• Increased Demand: By lowering the entry barrier, you can attract more investors who might lack the capital to buy a whole property but are interested in owning a fraction of it. 
• Higher Valuations: More demand can drive up the value of a property and so will yours as the competition among investors can lead to higher bids for ownership stakes. 

Implementation Tips:

• Marketing of your property: Leverage the social media platforms for marketing of fractional ownership and the potential for capital appreciation. 
• Choosing the right platform: Instead of doing everything on your own, you can take help from active platforms in the space such as Landshare. 

Enhance Liquidity and Cash Flow

Since buying and selling of real estate assets becomes easy and frequent, the liquidity goes up. The property owners can focus on selling the shares of a property at the best possible price to maintain the cash flow. It requires less hassle since you can find a large pool of investors interested in investing in real estate properties. 

• Quick Transactions: Tokens representing units of underlying real estate property can be easily bought and sold on digital exchanges. It provides faster and quick access to cash. 
• Regular Income: You can ensure a steady cash flow from rental income or other similar revenue streams. 

Practical Steps

• Let Smart Contracts Do the Job: Smart contracts are one proven way to automate the transactions whether it is rental income or dividends to token holders. 
• List on Multiple Exchanges: List your property tokens on multiple exchanges and you can increase the chances of quick sales and better liquidity. 

Global Access to Capital Markets

With tokenization of assets comes globalization of assets. Bringing your assets on chain means bringing it within reach of capital markets worldwide. Pool of investors from all over the world can invest in your property and it can increase the odds of raising capital by a huge margin. 

• Large Pool of Global Investors: Your property falls within the reach of international investments and it attracts more capital and potentially higher valuations for it. 
• Currency Diversification: Since investors across countries participate in investment, it brings different currencies that protect from economic fluctuations in the region. 
• Effective Marketing: As discussed above, using better marketing strategies to reach potential investors globally. For better impact, emphasize on the benefits of investing in your tokenized real estate property. 
• Regulatory Compliance: Make sure your tokenized property complies with international regulations to facilitate smooth transactions. 

Improved Transparency and Trust

Blockchain technology is synonymous with transparency and trust. It is immutable and secure that keeps all the transactions safe. These cutting-edge features better attract investors and keep them for long. 

• Boost Investors Confidence: Transparency of records eliminates the risk of fraud and builds confidence among investors. 
• Audits and Reporting Gets Easier: It is easier to audit transactions and provide accurate reports to stakeholders.
• Use Transparent Platforms: You can choose the platforms that provide transparency and security. We at Landshare prioritize these features as we understand its value. 
• Regular Updates and Reporting: Provide regular updates and detailed reports to your investors, showcasing the performance and management of the property.

In the End

Real estate tokenization offers you numerous opportunities to boost your profits as a property owner. You can maximize the value and profitability and value of your assets by attracting more investors through fractional ownership, enhancing liquidity and cash flow, accessing global capital markets, improving transparency and trust. 

The global real estate market is about to hit $700 Trillion in the coming years and tokenization of real estate has potential to share a significant share from this enormous valuation. As the sector continues to evolve by embracing emerging technologies such as tokenization, real estate property owners could see exciting transformations and extensive growth opportunities in the long run.