Markets

Wall Street is already tokenized — real estate is next

7 min read · Institutional adoption

The debate about whether tokenization "works" is largely over. The world's biggest asset managers have already put real, regulated funds on public blockchains — and investors have moved billions of dollars into them. What is still open is which asset class comes next. Real estate is the obvious candidate.

Two funds that ended the argument

Franklin Templeton was early. Its OnChain U.S. Government Money Fund uses a public blockchain to help record share ownership, with each share represented by a token nicknamed BENJI — one of the first times a US-registered mutual fund used a public chain in its record-keeping.

Then, in March 2024, BlackRock — the largest asset manager in the world — launched the BlackRock USD Institutional Digital Liquidity Fund (BUIDL) with tokenization firm Securitize. It invests in cash and US Treasuries and pays daily yield directly to token holders' wallets. Within weeks it was pulling in hundreds of millions of dollars, and it soon overtook Franklin Templeton's fund to become the largest tokenized treasury product — later expanding across multiple blockchains.

When the largest asset manager on earth issues a fund as a token, tokenization stops being a crypto experiment and becomes financial infrastructure.

Why money-market funds went first

Cash-like funds were the perfect proving ground for a simple reason: they are easy to value and easy to standardise. A Treasury fund has a transparent net asset value, deep liquidity and a well-understood legal form. That let issuers focus on the new part — the on-chain rails — without also solving hard valuation problems.

The payoff is visible in the mechanics: near-instant settlement, 24/7 transferability, automated yield distribution, and a single shared record between issuer, investors and infrastructure. These are exactly the properties tokenization promises for any asset.

DONE Cash / T-bill funds UNDERWAY Bonds & credit NEXT Real estate
Institutions tokenized the simplest assets first. Property is harder — and far larger.

What transfers to real estate — and what doesn't

The reusable parts are the whole institutional stack: regulated custodians, permissioned token standards, KYC'd investor onboarding, and integrations with the systems banks already run. That plumbing does not care whether the underlying asset is a Treasury bill or an apartment block.

What does not transfer cleanly is the hard part of property:

  • Valuation. A building does not have a live, transparent NAV. Appraisals are periodic and subjective.
  • Illiquidity of the underlying. Tokenizing a flat does not conjure buyers; secondary liquidity has to be built, venue by venue.
  • Local law. Property rights are national and paper-bound; linking the token to an enforceable deed is jurisdiction-specific work.

This is why Deloitte frames real estate tokenization as a decade-long build rather than an overnight flip, projecting the market to reach roughly US$4 trillion by 2035 — with tokenized funds and loans/securitizations (the parts closest to what BUIDL and BENJI already do) leading the way.

The read-through. The institutions have de-risked the technology and the regulatory model on cash-like assets. The frontier is now applying that proven stack to the messier, bigger prize: the world's property. That is the transition Real Estate by the Block exists to track.

Company and product names are used for factual, illustrative purposes only and do not imply any affiliation or endorsement. This is not investment advice.

Sources

  1. Axios, "BlackRock's tokenized treasury fund overtakes Franklin Templeton's" (2024).
  2. Deloitte Center for Financial Services, "Tokenized real estate" (2025).
  3. Boston Consulting Group & ADDX, "Relevance of on-chain asset tokenization" (via Ledger Insights).