Why Tokenized Real Estate Might Just Be a House of Cards! 🏠💸

by

As the world spins ever faster on its blockchain axis, a curious thing is happening: institutions are peering into the murky waters of blockchain-based finance, and some industry sages are proclaiming that tokenized real-world assets (RWAs) could balloon to a staggering $30 trillion by the 2030s. Others, however, are raising their eyebrows so high they might just take flight.

In a rather optimistic forecast from June 2024, Standard Chartered Bank and Synpulse predicted that RWAs might just reach that lofty $30 trillion mark by 2034. The narrative, like a particularly stubborn stain, remained strong throughout the latter part of 2024, with analysts echoing similar sentiments, perhaps while clutching their crystal balls.

Fast forward to Paris Blockchain Week 2025, where a panel moderated by the ever-enthusiastic Gareth Jenkinson of CryptoMoon gathered a motley crew of executives from the tokenization universe. Among them were Charles Adkins of Hedera, Dotun Rominiyi from the London Stock Exchange, Shy Datika of INX, Steven Gaertner of Tiamonds, and the ever-skeptical Michael Sonnenshein, COO of Securitize.

While the majority of the panelists were ready to throw confetti at the $30 trillion estimate, Sonnenshein, with the air of a man who just found a fly in his soup, expressed a rather different opinion.

Securitize exec predicts a more conservative trajectory for RWAs

Sonnenshein, who once held the title of CEO at Grayscale Investments, took a step back from the exuberance. He argued that while tokenized assets are all the rage, they might not actually reach the $30 trillion summit. “I have to just say,” he mused, “there are some really good systems in place that allow some of these assets to trade. Just because it can be tokenized doesn’t mean it should be. And so, I’ll take the under on the $30 trillion number.”

Despite being the lone wolf in a pack of optimistic sheep, Sonnenshein remained bullish on RWAs, insisting that his skepticism “doesn’t mean that tokenization isn’t here to stay.” After all, who wouldn’t want their digital wallet to be more than just a cryptographic piggy bank?

He envisioned a future where wallets would be seen as more than just a place for crypto speculation, but rather as a cozy abode for investments, much like a brokerage account that doesn’t require a mortgage.

Tokenization doesn’t “translate well” to representing real estate ownership

But wait! There’s more! Sonnenshein also raised a rather interesting point about the viability of real estate as a primary use case for RWAs. In the United Arab Emirates, government agencies have been busy linking tokenization with real estate, with local developer Damac signing a $1 billion deal with RWA blockchain Mantra to tokenize real estate in the UAE. Because, of course, why not throw a billion dollars at a blockchain idea?

While some are betting their bottom dollar on tokenized real estate, Sonnenshein threw a proverbial spanner in the works. “I’ll be the controversial one up here and just say I don’t think tokenization should have its eyes directly set on real estate,” he declared, likely while wearing a tinfoil hat.

He acknowledged the potential efficiencies that blockchain could bring to the real estate table, like eliminating middlemen and escrow agents, but he argued that the current on-chain economy is clamoring for more liquid assets. “I’m sure there are all kinds of efficiencies that can be unlocked using blockchain technology,” he added, “but today, what the on-chain economy is demanding are more liquid assets.”

Read More

2025-04-09 15:19