RWA (Real World Asset Tokenization) utilizes blockchain technology to convert real estate into divisible and transferable digital assets. The core aim is to lower investment thresholds, enhance transaction efficiency and transparency, providing innovative directions to solve the liquidity dilemma of existing commercial housing.
1. The underlying logic of RWA activating the liquidity of existing commercial housing
The essence of RWA improving the liquidity of real estate lies in reconstructing the transaction paradigm of real estate from three core dimensions:
1. Break down investment thresholds to mobilize inclusive capital
Traditional residential real estate investments often require several million or even tens of millions in capital, making it difficult for ordinary investors to participate; however, RWA can split the ownership of a single high-value property into thousands or even tens of thousands of digital tokens. For instance, a certain office project in Hong Kong valued at HKD 2.9 billion was divided into 1 million tokens, with a subscription threshold of only about HKD 1,000—this allows retail investors to participate in commercial real estate investments that were previously out of reach, introducing massive potential purchasing power for existing assets.
2. Restructure transaction processes to break through time-space constraints
On one hand, traditional asset securitization (e.g., REITs) requires multiple intermediaries such as law firms and brokerages, with processes taking months and incurring high costs; RWA relies on smart contracts to automatically complete transaction matching and income distribution, significantly shortening the issuance cycle. On the other hand, blockchain-based RWA tokens support 7×24 hour global trading, breaking down geographical restrictions and time barriers of traditional real estate transactions, greatly enhancing asset monetization efficiency.
3. Design dual exit mechanisms to strengthen liquidity guarantees
Mature RWA projects typically build a dual-layer liquidity guarantee system, providing investors with multiple exit options:
- Individual level: Investors can buy and sell their token shares at any time on compliant secondary markets, achieving flexible exits;
- Collective level: When a majority of token holders reach a consensus through voting, they can decide to sell the underlying property as a whole, with sale proceeds distributed to all holders according to their token proportions, forming a complete loop of 'digital equity—real-world returns.'
2. Practical forms and case studies of RWA in real estate
Based on the differences in the rights corresponding to the tokens, real estate RWA can be mainly divided into three models, with many landing explorations already conducted both domestically and internationally:
Equity tokens
Such tokens represent partial ownership of real estate, allowing holders to enjoy both asset appreciation and rental dividends, and usually also have governance rights over the project. For example, Greenland Hong Kong has split the office building in Causeway Bay into 1 million NFT ownership certificates; the American RealT platform has tokenized residential real estate, allowing investors to earn rental income daily; and the Dubai RST0001 project has completed a full lifecycle loop from issuance, operation to community voting for sale.
Yield tokens
Only corresponds to the share of specific cash flows from real estate (such as rent, operating income), without involving ownership transfer. For example, China Resources Longdi issues RWA products backed by the revenue rights of charging stations in Hong Kong, while GCL-Poly Energy tokenizes the revenue rights of photovoltaic power stations for financing, focusing on splitting and circulating cash flows.
Bond tokens
Essentially, it is a debt certificate for real estate, allowing investors to receive fixed interest regularly, with relatively low risk. Currently, platforms have launched tokenized products backed by real estate mortgages, splitting the debt into small tokens available for investors to subscribe.
3. The practical challenges of implementing RWA in real estate
Despite the promising outlook, RWA still faces multiple practical obstacles in activating existing commercial housing:
The compliance regulatory system is not yet complete
This is currently the most core challenge. The mainland has yet to introduce specific regulatory rules for RWA, so RWA projects of real estate companies such as Greenland and New City have chosen to be implemented in Hong Kong—where a clear regulatory framework for digital assets has already been established, effectively avoiding legal risks.
Offline asset operation capabilities are demanding
The value of RWA tokens is anchored to the quality and operational efficiency of the underlying real estate: if property management is lacking and asset maintenance is poor (e.g., the American RealT project in Detroit faced government lawsuits due to dilapidated houses), the token value may drop to zero. This requires issuers to possess professional asset management and operational capabilities to maintain the foundation of asset value.
There are barriers in technology and market understanding
Transforming real estate into 'divisible, verifiable, and chain-tradable' digital assets requires integrating capabilities across multiple fields such as blockchain technology, financial design, and legal compliance, presenting a new challenge for traditional real estate companies; at the same time, market understanding of these new digital assets still needs time to cultivate, and establishing trust consensus is not an overnight task.
4. The core differences between RWA and traditional REITs
RWA is often compared with Real Estate Investment Trusts (REITs), and there are essential differences between the two in terms of technical logic and rights design:
- Ownership and governance rights: RWA tokens represent direct, fragmented ownership of the underlying assets, allowing holders to participate in significant decisions regarding property disposal and operation; REIT shares only correspond to the income rights of the fund products, and investors cannot intervene in the specific management of the underlying assets.
- Transaction efficiency and thresholds: RWA supports smaller unit investment splits and can achieve near real-time transaction settlements; traditional REITs must follow the trading times and settlement rules of securities exchanges (e.g., T+2 settlement), with relatively low flexibility and efficiency.
Conclusion
RWA provides a highly potential digital path for activating existing commercial housing, breaking down the liquidity barriers of real estate through technological means. However, its large-scale implementation still awaits the maturity of the compliance environment, matching asset operation capabilities, and the gradual formation of market consensus.
