Blockchain
$500 Million in Dubai Real Estate to Soon Be Tokenized on Blockchain
- MAG partners with MANTRA to tokenize $500M in real estate.
- Blockchain offers small investors the opportunity to grab a slice of the pie.
- The first project is a luxury real estate development in Dubai.
The integration of blockchain technology in various industries is accelerating and the real estate sector is no exception. Developers are recognizing the potential of tokenizing the real estate sector as Real World Activities (RWA) on the chain.
Most recently, the United Arab Emirates (UAE) has taken the lead in this space with a new deal to tokenize $500 million of real estate in the country. This opens up a new opportunity for small investors who don’t have the money to buy entire properties, especially luxury real estate, which dominates Dubaithe largest city in the United Arab Emirates.
Tokenization of $500 Million in UAE Real Estate
Blockchain technology is making a big entrance into Dubai’s growing real estate market. On Wednesday, July 3, real estate developer MAG and RWA MANTRA platform has announced a plan to tokenize $500 million in MAG’s real estate portfolio. They will start with Keturah Reserve, a luxury residential development in Meydan, Dubai.
Tokenization will take place on MANTRA’s Layer 1 blockchain, which is geared toward institutional use. According to MANTRA, token holders can earn returns of around 8% APY in stablecoins, plus more on MANTA’s native blockchain. Cryptocurrency $OM. To ensure investor protection, RWA tokens will be overcollateralized. The collateral includes a $75 million mega-mansion at The Ritz-Carlton Residences in Dubai, in the Creekside development that is part of the Keturah resort, along with MAG’s corporate credit.
Talal Moafaq Al Gaddah, CEO of MAG Lifestyle Development, and John Patrick Mullin, CEO and founder of MANTRA, both highlighted the importance of integrating blockchain technology with tangible assets. The CEO of MAG further highlighted the importance of innovation in real estate development, in which Dubai is a leader.
Is Dubai the perfect place for RWA?
Dubai is uniquely positioned to benefit from the integration of real estate and blockchain technology. The city is a global hub for both technologies, attracting billions in real estate investments and a significant number of blockchain startups. In 2022, Dubai Free Trade District hosted over 500 Blockchain Startupsdemonstrating its attractiveness to cryptocurrency companies.
Dubai’s real estate market is also booming. In the first quarter of 2024, the residential market recorded 36,448 transactions for an amount to 30 billion dollarsdemonstrating the strong interest of investors.
Dubai’s robust real estate sector and growing cryptocurrency ecosystem make it an ideal location for projects that combine both sectors.
The other side of the coin
- US cryptocurrency insiders warn that if the country’s hardline stance on cryptocurrencies doesn’t change, it could lose many businesses to the UAE.
- The United Arab Emirates is working on its own central bank digital currency (CBDC), which is currently under development initial phase.
Why this is important
The success of this project will test the utility of RWAs in particular and blockchain technology in general for real-world applications. It will also open up new investment opportunities for smaller investors.
To learn more about MANTRA:
RWAs are on the Rise: MANTRA CEO Discusses Their Future
To learn more about Evolve Bank hacking:
Did Evolve Bank Know About the Cyber Attack Weeks Before Notifying Users?