How to Capitalize Trillions in Tokenized Real Estate with Blockchain and PropTech
Matthew Lam Aug 23, 2019 09:00
Real estate tokenization insights and Proptech investment landscape by Blockchain.News, Asia Proptech Association, HKBIA and Coinstreet Partners.
On the 22nd of August, we were proud hosts of our event that focused on ‘whether real estate will evolve by the development of blockchain?’ Now the question arises from the inevitable fact that financial technology has evolved within the last 10 years alongside several industries adopting it within their practices. Will the real estate market join into this newfound phenomenon? The belief is that large groups within the industry are not stagnant and are expanding their interests into the utilization of blockchain.
Our event aimed to answer these key questions throughout the event, starting with the opening speech by Matthew Lam, of Blockchain.News, who went through his overview of the real estate industry analysis and the 3 market segments of PropTech: smart home, real estate sharing, and Fintech. Additionally, he highlighted 3 interesting stories of blockchain application in the real estate industry. For example, the idea that real estate agents could be made redundant by the adoption of blockchain technology, Matthew highlighted that such would not be the case considering real estate’s ability to complete deals. He also believes that while tokenization of real estate opens up fractional ownership for retail investors, it can be a double-edged sword with the lack of liquidity and security exchanges with reasonable volumes. Matthew also highlighted the enormous potential of real estate tokenization, with 33.3 trillion in the US housing market and 16 trillion for commercial real estate. Looking ahead, Matthew believes that a number of questions need to be addressed before real estate tokenization can go mainstream, including the complex structure of custodians and law requirements as well as the fungibility of the tokens.
Our co-host and incredible contributor, Asia PropTech represented by Leo Lo, presented the overall PropTech market trends. For instance, 37% of commercial real estate executives and investors believe blockchain will have a significant impact on the industry within two years. Globally, Proptech has secured funding of $2.69 billion across 277 deals in 2016. It is also worth noting that the Global Real Estate Value in 2015 is $217 trillion contrasting starkly with the total value of gold ever mined valued at $6 trillion. Leo also provided cumulative statistics, ‘60% of the world’s total Proptech Investment is located within APAC regions including Greater China, Korea, Japan, and India.’ 
Source: Unissu
The third speaker of the night was Rex Wong of the Hong Kong Blockchain Industry Assocation, discussing real estate tokenization. Of the many points he raised, the parallels between the US and Hong Kong’s real estate tokenization compliance regime brought to the similarities in their regulation. Equally so, he provided examples of properties who have already utilized real estate tokenization as can be seen below:
To conclude, our final speaker, Samson Lee, the Founder and CEO of Coinstreet Partners, notable for his vast experience, spoke in-depth on the topic of regulation and compliance regarding security tokens. One of the points mentioned was the construction of a token model extending to consultation, tokenization, initial offering, OTC trading, security token exchange. The STO opportunities as he explained, for investors, could provide access to billions by capital methods. Further explained in the diagram below:
Overall, we are delighted by the outcome of attendees at the event as well as the engagement and various exchanges in the panel and networking segment of the event. We are grateful to have accommodated all our guests and hope to see the implementation of the ideas in the growth of blockchain and Proptech respectively.
Image via ShutterstockImage source: Shutterstock
