Succession Risks Threaten Growth in Tokenized Real Estate

Venket Naga’s warnings underscore the growing need for clear succession protocols in tokenized real estate, reflecting industry concern about potential disruptions and liquidity risks.

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The absence of standardized succession mechanisms in tokenized real estate was the focal concern at the TokenizeThis 2025 panel. Experts, including Venket Naga, noted the substantial risks posed to current tokenized property practices. The panel emphasized that increasing reliance on blockchain for real estate requires legally recognized solutions for inheritance.

Venket Naga and other industry leaders are pushing for regulations that protect tokenized real estate interests and ensure secure ownership transfers. “As a bedrock of traditional property law, inheritance could prove to be a point of failure for real-world assets if its logic is not scaled to blockchain technology,” remarked Naga. The discussions underscored the potential disruptions in current asset management practices. Institutional players like BlackRock and Vanguard remain cautious yet interested in exploring tokenized assets.

The absence of clear succession protocols could hinder future investments and shake investor confidence. Concerns over potential disruptions in asset ownership could affect market liquidity and innovation in fintech solutions. Projections foresee a $4 trillion tokenized real estate market by 2035, emphasizing the need for robust legal and technological frameworks to address these issues.

Insights signal potential technological innovations and regulatory adjustments could shape future protocols. While unresolved, the integration of smart contracts and blockchain-based verifiable credentials may offer solutions. The real estate industry seeks to capitalize on blockchain’s promise but confronts must-adapt inheritance rules to unleash its full potential.