Tokenization Solves Property Fraud And It's A Big Deal!

It may not be common knowledge as the vast majority of the crypto space are focused on green candles and the weight of their meme bags, but real estate, amongst other sectors stands to benefit largely from the technological development around crypto and blockchain technology.

These benefits can cause as much $1 billion to flow back into the property market, also, it's expected to largely increase the courage level amongst investors looking to move into the sector.

The housing market has been a versatile business hub for years, but unfortunately, where there's a system of high value, there's bound to be several unethical seeds planted to exploit the system. With real estate, or the property market as a broader sector, the industry's value has been widely leveraged by bad actors to extract undeserved cash flow.

This systematic flaw greatly affects not only the property market but several other businesses as the cash flow that may have been moved into various ventures gets channeled to the exploiters pockets.

The Problem - non-verifiable property data

It's no secret that the vast majority cannot distinguish between real or authentic property ownership documents from fake ones, heck even professionals sometimes get played with expertly forged documents.

In addition to this, the ease in impersonation is largely a growing concern as this rather smoothens the process of bad actors executing their plans. According to a 2023 report, imposter scams were the most prevalent form of fraud reported, costing victims $2.6 billion, up from $2.4 billion in 2021.

This is nearly 30% of consumer reported frauds of $8.8 in the market of 2022. That said, when we look at some other data like the fact that roughly 26% of the real estate market in 2023 were first-time home buyers, we can tell that there's growing demand within the sector, or say, a growing cash flow.

The urgency for consumer protection is growing rapidly as studies predict that as much as $1 billion will be lost to “deed fraud”(property fraud) each year.

With papers not being reliable and the criminal market actively growing smarter in its delivery of fraud, the property market requires a solution that enforces authenticity in property exchange and encourages active participation.

NFTs as the born child of tokenization to save the property market

NFTs are prolly the most underrated development of our time. Maybe because the art industry had an early advantage to fuck it up?

Such power of stigmatization.

Notwithstanding, NFTs are bound to serve as a backbone for various future structures in business and investment.

NFTs as certificates, NFTs as legal documents, NFTs are gatepasses, NFTs are bonds, NFTs as a phase 2 tokenization of real world assets - this is actually where things get interesting.

Picture a financial contract that involves, first, the fungible tokenization of a company's shares, this is the phase that enables wide fractional ownership of company's assets, then there's the non-fungible phase which is typically process of turning the already fungibly tokenized shares into NFTs by locking up the fungible tokens in a smart contract and minting the NFTs.

These kinds of NFT shares can be used as bonds, a collateral worthy asset that can vastly change how the market functions.

On a similar note, the property market can be largely improved and a lot of fraud fought. Think about it, a legal smart contract that keeps tab of the property market, ensuring authenticity and avoiding consumer losses by feeding on-data(verifiable proof of assets ownership - NFTs) through blockchain oracles to off-chain databases or systems to ensure that consumers can deal with the right people and not get ripped of by local and sometimes international property market fraud.

Posted Using InLeo Alpha