By Mr, Raman Nagpal, CEO & Founder – Big Assets Infra
Traditionally, real estate has been one of the most trusted and stable asset classes in India. However, high entry barriers, limited liquidity, and cumbersome paperwork have often kept this lucrative sector out of reach for retail investors. But a quiet revolution is underway. Tokenization—the process of converting real-world assets into digital tokens on a blockchain—could fundamentally reshape the real estate landscape in India.
By lowering the cost of entry, enhancing liquidity, and ensuring greater transparency, tokenization has the potential to democratise real estate investment. But is India ready for this tech-led transformation? Let’s dive deeper.
Understanding Tokenization: What Is It and How Does It Work?
Tokenization refers to the process of digitising a real-world asset, such as a piece of land or a commercial property, and representing it as a digital token on a blockchain. Each token can represent a share in the property, giving token holders fractional ownership.
For example, if a commercial property is valued at ₹10 crore, it could be tokenised into 10 lakh digital tokens. An investor could then purchase tokens worth ₹10,000, ₹50,000, or ₹1 lakh, gaining a proportionate stake in the asset’s value and returns—without needing to buy the entire property.
These tokens are backed by legal contracts and smart contracts on the blockchain, which govern the terms of ownership, revenue sharing, and exit options. This method makes investing in real estate more like investing in stocks, with the added benefit of partial ownership and liquidity.
Why India Could Benefit from Tokenized Real Estate
1. Lowering the Entry Barrier
Real estate in metro cities like Mumbai, Delhi, and Bengaluru is prohibitively expensive. Tokenization enables fractional ownership, allowing individuals to invest with as little as ₹10,000–₹50,000. This opens up access for younger investors, middle-class households, and NRIs looking for passive income opportunities.
2. Enhanced Liquidity
One of the biggest drawbacks of traditional real estate is the lack of liquidity. Selling a property can take weeks or months. With tokenization, investors can trade their tokens on secondary marketplaces, much like equities—making it easier to exit or diversify.
3. Greater Transparency and Security
Blockchain technology ensures that every transaction is immutable and traceable, reducing the scope for fraud and title disputes. Smart contracts automate and enforce agreements, reducing the need for intermediaries and lawyers.
4. Diversified Portfolios
Just as mutual funds allow diversification across stocks, tokenization enables investors to own fractional stakes in multiple properties across geographies and asset classes—residential, commercial, hospitality, or even warehousing.
Global Success Stories Pave the Way
Countries like the United States, Switzerland, and Singapore have already embraced tokenized real estate. Projects like the Aspen Digital Token, which allowed fractional ownership in a luxury hotel, and RealT, a U.S.-based platform for tokenised properties, have demonstrated the viability of the model.
India, with its growing digital adoption, increased investor appetite, and mature real estate market, is well-positioned to be a part of this global shift.
The Indian Context: Current Scenario and Challenges
While the concept is promising, tokenized real estate is still in its infancy in India. Regulatory uncertainty, lack of infrastructure, and limited public awareness are major hurdles.
1. Lack of Regulatory Framework
There is no dedicated legal framework that governs tokenized real estate in India. While SEBI and RBI have taken positive steps in regulating digital assets, clarity is still needed on whether real estate tokens will be classified as securities or something else.
2. Property Title Verification
Land records in India are often outdated or poorly maintained. Without a robust title verification system, it becomes difficult to establish the legitimacy of tokenised ownership.
3. Taxation and Compliance
The tax implications for fractional property ownership via tokens are unclear. Whether such investments would attract capital gains tax, GST, or stamp duty is yet to be clarified by the authorities.
4. Need for Digital Literacy
Tokenization depends on blockchain literacy, digital wallets, and secure custody of private keys—areas where many Indian investors still lag behind.
Pioneers in the Indian Market
Despite the roadblocks, several Indian startups and real estate firms are testing the waters. Platforms like PropShare, RealX, and MYRE Capital are offering fractional ownership models, though not all are fully tokenised or blockchain-based yet.
Big Assets Infra, a real estate development and sales company known for its successful projects in Goa, is reportedly exploring ways to integrate digital technology into its investment offerings. With its recent appointment as selling partner for the Grama Villa Plots near the Goa-Maharashtra border, the company has shown interest in future-ready investment formats that cater to a broader audience—potentially including tokenized models.
What Needs to Happen Next?
Regulatory Clarity
A comprehensive legal framework is essential. Regulatory bodies need to define how real estate tokens are classified, taxed, and transacted.
Land Digitisation
States must accelerate the digitisation and verification of land records to ensure clean titles, which are a prerequisite for tokenization.
Public Awareness
More workshops, investor awareness programs, and government-backed initiatives are required to educate investors about the benefits and risks of tokenised real estate.
Pilot Projects
Well-regulated pilot projects in smart cities or SEZs can demonstrate feasibility and build trust in the model.
Key Takeaways
- Tokenization of real estate can revolutionise property investment in India by making it more accessible, liquid, and transparent.
- Fractional ownership, powered by blockchain, allows retail investors to enter the market with smaller sums.
- Regulatory clarity, land title reform, and investor education are critical for mass adoption.
- Companies like Big Assets Infra and startups are beginning to explore the potential of digital property investments.
- India stands at the cusp of a new investment era—if the right ecosystem is built.
In conclusion, Tokenization isn’t just a technological trend—it represents a paradigm shift in wealth creation. In a country like India, where real estate is deeply linked to aspirations, tokenization can finally bridge the gap between intent and access.
While challenges remain, the direction is clear: as digital infrastructure matures and regulations evolve, tokenised real estate could become the most inclusive form of property investment India has ever seen.
