The Dubai Land Department (DLD), which oversees the real estate sector, has announced the launch of a pilot program for real estate tokenization, positioning itself as the first property registration authority in the Middle East to implement blockchain technology for property title deeds.
This initiative was crafted in collaboration with the Virtual Assets Regulatory Authority (VARA) and the Dubai Future Foundation (DFF). It is part of Dubai’s vision for its 2033 real estate strategy and aims to bolster the city’s status as a global technology hub.
The department estimates that tokenized real estate could represent 7% of the city’s entire property transactions, potentially totaling 60 billion dirhams (approximately $16 billion) by 2033.
Dubai’s venture into real estate tokenization is part of a broader trend to incorporate blockchain into conventional markets, enabling the representation of real-world assets (RWAs) such as bonds, funds, and credits on decentralized platforms.
With tokenized RWAs, ownership can be divided and transferred via blockchain, reducing barriers for investors and enhancing liquidity in the market. Unlike crowdfunding, which aggregates funds from multiple investors for property purchases, tokenization offers a more structured approach to ownership. However, a recent report indicated that real estate may experience a slower pace of tokenization growth due to various operational challenges.
Marwan Ahmed Bin Ghalita, the director general of DLD, stated that this initiative aims to “simplify and improve the processes involved in buying, selling, and investing in local real estate,” while the department is actively engaging with tech companies to refine the project before expanding it.