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Exploring the Secondary Market of Real Estate Token - An Empirical Analysis

Author

Listed:
  • Heiko Leonhard
  • Ralf Laschinger
  • Wolfgang Schäfers

Abstract

The tokenization of real-world assets is one of the fastest growing innovations in blockchain technology within the financial landscape. It is poised to redefine the current paradigm in how we fund, trade, and manage assets. Its disruptive potential is particularly significant for traditionally illiquid assets, such as real estate. One of the main promises of tokenization is the improvement of accessibility, liquidity, and tradability. Therefore, a functioning and lively secondary market is a necessary requirement. We observed 342 real estate tokens in the USA traded between 2021 and 2023 across various marketplaces. Based on 2,429,220 blockchain transactions, we analyze the market structure of real estate tokens and the dynamics of liquidity, tradability, and their determinants. Our study is the first comprehensive empirical investigation into secondary market activities and liquidity for real estate token. This research provides guidance for real estate token investors, business actors, and regulatory entities on the practical functioning and the maturity of the nascent secondary markets for real estate tokens.

Suggested Citation

  • Heiko Leonhard & Ralf Laschinger & Wolfgang Schäfers, 2024. "Exploring the Secondary Market of Real Estate Token - An Empirical Analysis," ERES eres2024-098, European Real Estate Society (ERES).
    • Handle: RePEc:arz:wpaper:eres2024-098
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    More about this item

    Keywords

    Digital Assets; Real Estate Token; Secondary market; tokenization;
    All these keywords.

    JEL classification:

    • R3 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location

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