- Blockchain framework will have legally binding real estate tokenization.
- BSPT tokens offer the liquidity and fractional ownership of real estate assets.
Blocksquare SARL has launched a Luxembourg-based Notarized Real Estate Tokenization Framework. This platform has become the first-ever to directly connect with land registries using notarized agreements for real estate tokenization. It is the result of working with blockchain technology and traditional laws to support property. The new framework aligns with EU legislation.
It thus enables a property owner to tokenize economically associated rights attached to real estate assets but holds all ownerships. By use of BSPTs, investment into economically secured rights is given access. These processes undergo notarization, ensuring legal enforcement that aligns with Luxembourg’s excellent legal framework.
Blocksquare Establishes EU’s First Legal Real Estate Tokenization
The process begins with creating a batch of BSPT tokens for each property. The structured borrowing arrangement then allocates these tokens to the property owner. A lien is placed on the property’s title, and once completed, BSPT holders receive the economic rights to leasing revenue or potential sales. These rights form an integral part of commercial real estate pricing, ensuring that there is an expected return on such investments. BSPT tokens can then be bought, held, or sold on secondary markets, increasing real estate asset liquidity.
To this, Blocksquare SARL’s chief executive, Denis Petrovcic has stated that the tokenizing real-world assets move was of paramount importance. This is because legal uncertainties have taken huge roadblocks in tokenizing real-world assets. With the incorporation of Blocksquare SARL, we have established a legally enforceable framework that bridges blockchain technology with traditional property laws.
The convergence of Luxembourg’s regulation with the financial laws of the EU, particularly the MiCAR (Markets in Crypto-Assets Regulation), further fortifies the framework in terms of credibility and gives investors access to institutional-grade safety.
In 2023, Blocksquare managed to notarize the very first tokenized real estate transaction in Slovenia. Belgium and Austria are to host the pilot projects. Germany, Poland, and France are part of the development pipeline for access to institutional investors and large-scale real estate projects.
