Dubai

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Real-world assets entered the mainstream around 2020, though the idea traces back further. As the name suggests, RWAs are traditional or physical assets that have been tokenized and brought onto the blockchain. The foundation was first laid with Ethereum’s (ETH) introduction of smart contracts in 2015, and the sector has since accelerated rapidly, with some forecasts projecting that by 2030, more than $10 trillion worth of assets could be tokenized on-chain.

Summary

• Why RWAs matter: Tokenization unlocks liquidity through fractional ownership, broadens access to global investors, and replaces costly intermediaries with transparent, efficient smart contracts.
• Why Dubai leads: Backed by VARA’s clear framework and booming property market, Dubai turned tokenization into policy — with $399M already tokenized in May and projections of $16B by 2033.
• Real traction: Platforms like Prypco Mint are selling out projects in minutes, including a $3B MAG deal, signaling tokenization’s shift from pilot projects to mainstream adoption.
• Challenges ahead: Secondary-market liquidity, registry integration, and rising global competition remain hurdles, but Dubai’s regulatory clarity and momentum give it a strong edge.

Why are real-world assets important?

At a high level, RWAs bring many benefits to the market, although there are three key ones:

1. Liquidity: Real estate and other illiquid assets typically demand large, single transactions, making buying and selling slow and cumbersome. Tokenization enables fractional ownership and 24/7 trading, transforming how these assets are exchanged.
2. Access and inclusion: Tokenization lets anyone with a wallet invest, unlocking deep global liquidity and enabling participation at any transaction size previously impossible.
3. Efficiency and transparency: many layers of expensive intermediaries and cumbersome transaction processes are exchanged for simple, clear contracts, lowering costs, reducing settlement times, and providing auditability.

Why is Dubai taking the lead?

The roots of real-world asset tokenization trace back to the United States, where early experiments sought to bring real estate onto the blockchain nearly a decade ago. One of the most notable examples was the tokenization of the St. Regis Aspen Resort in 2018, which raised $18 million through a security token offering. Similar pilots followed in markets like New York and Miami, but regulatory ambiguity in the U.S., particularly around whether such tokens qualified as securities, slowed momentum.

Dubai, on the other hand, backed by VARA’s forward-looking approach, has introduced a clear, dedicated legal framework with a new licensing category: Asset-Referenced Virtual Assets (ARVAs). This clarified requirements to ensure ARVAs are held to the same standards of trust as traditional finance, enabling both issuers and investors to operate within a strong framework.

The timing of this is ideal. Dubai’s property market is booming; May alone saw $18.2 billion in sales across 18,700 deals, up 44% year-on-year. Of that, $399 million (17.4%) was tokenized. The Dubai Land Department projects that tokenized real estate will reach $16 billion by 2033, supported by its Prypco Mint platform, where investments start from just 2,000 Emirate Dirhams ($545). With three projects already fully funded (the second one selling out in just 1 minute and 58 seconds) and a $3 billion MAG deal inked in May, tokenization has shifted from experimentation to a core pillar of Dubai’s real estate strategy.

Imminent challenges

That being said, Dubai still faces several hurdles if it wants to sustain momentum in real estate tokenisation. Most stem from the early-stage nature of the market:

1. Secondary-market liquidity: Demand has been strong at the launch of projects, but long-term liquidity remains thin. Without active secondary trading, one of tokenisation’s main benefits — continuous, low-friction resale — falls flat, which could dampen appetite for new offerings.
2. Fees and registry processes: Even if a property is tokenised, investors must still pay the Dubai Land Department’s standard transfer fee (typically 4%; some platforms like Prypco Mint have offered discounted rates of around 2%) and update official records. Blockchain transfers alone do not yet update legal titles, and DLD recognition is still required. Until full registry integration is in place, tokens mainly represent beneficial rights, not direct title.
3. International competition: Other jurisdictions are moving quickly to establish frameworks for tokenised property. As these alternatives mature, Dubai’s early-mover advantage may narrow, though whether international supply meaningfully erodes its lead remains to be seen.

What comes next for Dubai?

Little stands in the way of Dubai’s tokenization drive today. A clear regulatory framework, full-stack market infrastructure, strong government backing, and global demand for high-yield property are fueling rapid growth. As long as new projects continue to launch, secondary market liquidity deepens, and international demand holds, Dubai’s lead in real estate tokenization should only strengthen.

James Murrell

James Murrell is a product and strategy professional at a leading crypto exchange. His experience includes over 6 years in operations, commercial strategy, and product management across a range of crypto and fintech startups. James started his blockchain journey in 2013, first entering the space in a professional capacity in 2018.

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