Dubai launches first licensed tokenized real estate project in MENA region
Dubai has launched the first licensed tokenized real estate project in the Middle East and North Africa (MENA) region, previewing appetite for real-world tokenization in one of the world's burgeoning crypto hubs.
Partners in the project include the Dubai Land Department (DLD), the Central Bank of the United Arab Emirates, and the Dubai Future Foundation, according to an announcement from the Dubai government. The tokens will be tradeable on the newly launched 'Prypco Mint' platform, with Zand Digital Bank appointed as the bank for the project's pilot phase.
On May 19, Dubai's Virtual Assets Regulatory Authority (VARA) updated its rules to include real-world asset (RWA) tokenization, allowing such tokens to be traded on secondary markets.
The project will allow individual investors to buy tokenized shares in 'ready-to-own properties in Dubai,' with investments starting at 2,000 Emirate dirham ($545). During the pilot phase, all transactions will be carried out in the dirham (AED), with no cryptocurrency to be used. Although the pilot program will be limited to those with UAE ID holders, there are plans to expand it globally.
In April, the DLD and VARA agreed to link Dubai's real estate registry with the tokenization of property. The stated goal was to attract global investors and enhance liquidity in Dubai's real estate market. The project was initially announced in March.
A sought-after destination for crypto entrepreneurs, the United Arab Emirates is positioning itself as a crypto hub. In May, Dubai, an emirate within the country, partnered with Crypto.com to help facilitate crypto payments for government services. Real estate tokenization market may reach $19.4 billion by 2033
Real estate is one of many areas of RWA tokenization that is poised for a breakthrough over the next few years. It fulfills some key promises of blockchain technology, providing liquidity to relatively illiquid assets and granting greater accessibility to retail investors.
According to Custom Market Insights, the global real estate tokenization market is expected to reach a $19.4 billion market cap by 2033, growing at a compound annual rate of 21%. All three types of real estate — residential, commercial, and industrial — will play a role.
Some of the companies that specialize in tokenizing real estate include RealT and Metlabs. However, many others have struggled in their efforts, largely due to the complexities of navigating regulatory requirements.
Source: https://cointelegraph.com/news/dubai-launches-first-licensed-tokenized-real-estate-project-in-mena-region
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