Year: 2023
Type: article
Abstract: To better understand the potential and limitations of the tokenization of real asset markets, empirical studies need to examine this radically new organization of financial markets. In our study, we examine the financial and economic consequences of tokenizing 58 residential rental properties in the US, particularly those in Detroit. Tokenization aims at fragmented ownership. We found that the residential properties examined have 254 owners on average. Investors with a greater than USD 5,000 investment in real estate tokens, diversify their real estate ownership across properties within and across the cities. Property ownership changes about once yearly, with more changes for properties on decentralized exchanges. We report that real estate token prices move according to the house price index; hence, investing in real estate tokens provides economic exposure to residential house prices.
Source: Financial Innovation
Author: Laurens Swinkels
Institution: Erasmus University Rotterdam
Language: English
Subfield: Management Information Systems
Domain: Social Sciences
Open Access status: diamond
Funder: Inquire Europe
OpenAlex ID: W4317375463