Buying real estate with little capital? NFTs and Tokenization

Until recently NFTs For us, they were comic images of monkeys, teddy bears or other pixel characters. The slightly caricatured form in which non-fungible tokens conquered the market lulled the vigilance of slightly more conservative investors – they simply did not take this innovation seriously. In the short term this may have been wise, but the initial NFT image may distort the vision of the future this innovative technology. It’s like ignoring e-books at the beginning of their existence – today we already know how popular they have become.

The same may happen with non-fungible tokens, i.e Non-Fungible Tokens (NFT). Contrary to appearances, tokens of this type do not have to be related only to pixel art – or art in general, because this market was a training ground for NFT technology. Meanwhile use of non-fungible tokens is much wider.

NFT tokens as proof of ownership

If the whole meaning of this novelty were to be summed up in two words, they would be the words “law” and “property” – or “evidence” and “property”. An NFT token is just that, digital proof of ownership and not only digital. Already during the last boom of 2021-2022, NFT start-ups experimented with non-fungible tokens (i.e. indivisible, indivisible, one-of-a-kind) that could be exchange for physical items – for example, T-shirts.

However, the prospects for this technology do not end with T-shirts, mugs and various other trinkets. Since the NFT token is unforgeable, it can be used in many ways. Maybe ID card in the form of NFT? In this case, the data stored in the token would not be visible to unauthorized persons, and at the same time, the authorized token itself would indicate that “we are us”. Let’s also go back to the previous two words – proof of ownership. An NFT can be digital proof of ownership of anything. What could it be? E.g. real estate.

Tokenization – real estate investments available to everyone

It’s about tokenization of assets and the possibility of fragmenting goods that have so far been difficult to divide into smaller parts. Among others real estate are characterized by large entry threshold for small investors – it is not common for someone to buy, for example, 1 square meter of an apartment. Everything or nothing. NFTs change that. Tokenization of assets changes this. Thanks to tokenization, one thing 100 square meters apartment can be divided into 100 parts, each of which is represented by one “ownership” token.

This solution creates not only the opportunity to invest in markets previously reserved for wealthier people, but also an additional opportunity to raise capital by entities seeking capital – e.g. developers. The entry threshold is decreasing, so small capital is released – small, but small a school of small fish can be more powerful than that whale.