Currently, one of the most popular applications of blockchain technology in real estate is tokenization of real estate ownership. Tokenization is a form of fractional real estate ownership. The notion is that each token, an automated contract called a “smart” contract, represents a fractional ownership share of a specific property. Since blockchain tokens are non-fungible tokens (NFT), let’s refer to fractional real estate (RE) ownership tokens as RE NFT.
In recent years, crowdfunding of real estate has gained popularity. It too represents a form of fractional ownership, except that most crowdfunding projects put the participants in the role of lenders, rather than being owners of fractions of a property. For any crowdfunding project that cedes a portion of ownership to participants, generally the same points below about RE NFT apply.