Tokenization of real estate in Dubai: a new stage of market development with the DLD project
In March 2025, the real estate market in Dubai reached a qualitatively new level thanks to the launch of the pilot phase of the innovative project "Real Estate Tokenization" initiated by the Dubai Department of Real Estate (DLD). Its goal is to convert real estate rights into digital tokens on blockchain, which opens up new horizons for investment: from simplifying transactions to increasing transparency and security.
This project is the first such government effort in the region to formalize the use of blockchain in property registration. It is being implemented under the Real Estate Evolution Strategy (REES) with the support of the Dubai Virtual Asset Regulatory Authority (VARA) and the Dubai Future Fund (DFF). The tokenized real estate market is expected to reach AED 60 billion by 2033.
Tokenization of real estate in Dubai is not just a technological novelty, but a strategic step towards a digital future. In this material, we will look at how this model works, what role DLD plays and what advantages it offers investors.
Review of the tokenization project: an innovation for Dubai's real estate market
The Dubai Real Estate Tokenization Project, launched this year by the Dubai Department of Real Estate (DLD), has become an important milestone in the implementation of the city's real estate sector development strategy until 2033. The initiative envisages widespread adoption of digital technologies, including blockchain, to modernize and improve the efficiency of the real estate market in Dubai.
The essence of tokenization is that a physical asset, such as real estate, is divided into digital tokens, each of which reflects a share of ownership. This makes it possible to attract investors with different financial capabilities, simplifies market entry and makes investing more accessible to a wider audience.
The project is implemented in collaboration with the Dubai Virtual Asset Regulatory Authority (VARA) and the Dubai Future Fund (DFF) on the SandBox Real Estate platform. This collaboration ensures that standards of safety, legality and technological innovation are met.
The initiative is also part of the D33 global economic plan aimed at the digital transformation of key industries. Tokenization simplifies the processes of buying, selling and investing in real estate, provides greater transparency, liquidity and speed of transactions, and creates new opportunities for both local and international investors. This project is a true game-changing breakthrough in Dubai's real estate market.
How tokenization works on the blockchain
The tokenization of real estate in Dubai is based on the use of blockchain technology, which guarantees the security, transparency and immutability of transactions. Each token is a digital record corresponding to an ownership stake in a real estate asset. This allows investors to buy only a portion of the asset according to their budget without having to purchase the entire property. Due to its decentralized nature, blockchain in real estate reduces fraud risks and simplifies the process of exchanging ownership.
The role of DLD in the development of tokenization
The Dubai Department of Real Estate (DLD) is playing a key role in the introduction of real estate tokenization in Dubai. It is the first government body in the region to officially integrate this technology into property registration. DLD is actively contributing to the ecosystem by organizing workshops with leading PropTech companies and launching the innovative SandBox Real Estate platform. As a result, technology players are attracted to Dubai, fostering a modern, open and transparent real estate market.
Benefits of tokenization for investors and the market
Real estate tokenization is ushering in a new era of opportunities for investors, making investing in Dubai more affordable, flexible and attractive. Thanks to asset splitting technology, investors no longer need to buy a full-fledged real estate property - all they need to do is purchase digital tokens representing a share of the property. This significantly lowers the financial barrier to entry into the market and expands the range of potential investors.
One of the main advantages of tokenization is increased liquidity: tokens can be bought, sold or transferred much faster and easier than traditional assets. In addition, the transparency of blockchain provides a reliable record of ownership and minimizes fraud risks.
Key benefits of tokenization for investors and the market:
Availability of investments due to asset fragmentation;
High liquidity of tokens;
Transparency and security of operations;
Lowering the market entry threshold;
Opportunity to diversify investments;
Passive rental income or capital gains;
Openness to global investors.
Investors can profit from rental payments or growth in the value of the asset by owning only a part of the property. This model attracts not only local but also international players, contributing to the globalization of the market.
Accessibility to a wide range of investors
Tokenization of real estate makes investments as affordable as possible: even investors with a small budget can buy a share in premium properties, such as apartments in Downtown Dubai. Thanks to digital tokens, there is no need to buy the entire property - just invest the amount corresponding to the opportunities, which significantly reduces financial barriers.
Transparency and security of transactions
An important advantage of tokenization is the high level of security and transparency of transactions. Thanks to the use of blockchain technology in real estate, all transactions with tokens are stored in an unaltered decentralized register, which excludes the possibility of falsification or unauthorized changes. This significantly reduces the risks of fraud. In addition, DLD, together with VARA, has established a robust regulatory framework to protect investors and ensure the legality of digital transactions.
Impact of the project on the Dubai real estate market
The launch of the tokenization project has a significant long-term impact on the entire Dubai real estate ecosystem. According to the projections already mentioned above, the tokenized asset market could reach AED 60 billion by 2033, indicating the growing investor interest in digital property formats. This makes tokenization one of the key drivers of industry transformation.
The project not only changes the format of investment, but also facilitates the entry of global technology companies into Dubai, which in turn stimulates the development of the PropTech sector - an industry that combines real estate and technology. Thanks to the innovative SandBox Real Estate platform and support from the Dubai Department of Real Estate (DLD), the city is creating a favorable environment for testing new digital solutions.
Tokenization also strengthens Dubai's position as a global hub for virtual assets, increasing its competitiveness in the international market. It opens up opportunities for new products ranging from dynamic investment portfolios to premium co-ownership programs.
This project also improves the investment climate by facilitating market access for international and private investors. Combined with modern legal and technological infrastructure, tokenization is becoming a powerful tool for sustainable growth of the real estate market in the emirate.
Advice for tokenized real estate investors
Investing in Dubai through tokenized real estate opens the door to an innovative financial instrument that combines the flexibility of digital assets with the reliability of real property. But before taking the first step, it is important to prepare and make decisions based on the key factors of security, feasibility and prospectivity of the property.
Here are some practical tips for investors:
Familiarize yourself with the regulatory requirements of VARA. Before buying tokens, familiarize yourself with the legal framework established by the Dubai Virtual Asset Regulatory Authority (VARA). This will help you act in accordance with local regulations and avoid legal risks.
Choose licensed platforms that work with DLD. Invest only through platforms accredited by the Dubai Real Estate Department and participating in the tokenization pilot project. This ensures the safety and security of your funds.
Analyze the property before investing. Evaluate the attractiveness of the property by looking at location, infrastructure, rental demand, and growth potential. The most promising are apartments in Downtown Dubai and villas on Palm Jumeirah.
Take advantage of the opportunities of the pilot phase. At this stage, tokenization is still being tested, so this is a great opportunity to enter the market with minimal risks and evaluate the benefits of the new investment model. A full-scale launch is expected after the results are evaluated.
Investing in tokenized real estate is a step into the future. By preparing in advance and following the recommendations, you can effectively utilize the potential of this innovative market and make your investment in Dubai as successful as possible.
