Over the past decade, the financial landscape has been reshaped by a wave of alternative financing models. Leading the charge was crowdfunding— the practice of raising small contributions from many individuals to fund a project or venture. Whether donation-based, debt-based, rewards-based, or equity-based, crowdfunding laid the foundation for other models like P2P lending, microcredits, and decentralized finance (DeFi) platforms such as Aave, Compound, and MakerDAO. These tools opened up financing for ideas deemed too risky or complex for traditional banks.
One of the latest evolutions is crowd-owning — a model that blends co-ownership or fractional ownership with investment flexibility. Rather than merely funding a project, participants co-own an asset — often real estate — and share in its returns. This approach empowers individuals to invest in high-value assets like homes, land, or infrastructure, without bearing the full cost of ownership.
Consider platforms like CrowdToLive, InvestBay, REIDAO, or Immotokens. These enable buyers to partially own a property, with the remaining shares held by investors. The buyer lives in the property and pays rent on the portion they don’t own, while investors earn rental income and benefit from property appreciation — a win-win structure.
This model isn’t limited to homes. Think luxury cars, boats, private jets, land (e.g. forests), sports facilities (e.g. soccer fields, tennis courts, swimming pools), or even advanced machinery (e.g. 3D printers). Shared ownership makes previously unattainable assets accessible to a broader audience. These models expand access, reduce waste, and increase utility.
Crowd-owning already lowers entry barriers, but tokenization takes it further. By converting real-world assets into digital tokens using blockchain, ownership becomes fractional, tradable, and transparent. While crowd-owning usually requires significant administrative overhead to manage shared ownership, blockchain streamlines this. The cumbersome paperwork traditionally linked to real estate investing is eliminated. Token transactions are recorded on a public ledger, secured cryptographically, making them highly resistant to fraud or tampering.
Imagine this: a €3 million building with ten apartments might traditionally be sold to ten buyers at €300,000 each. Tokenization reimagines this — splitting the building into one million tokens worth €1 each. Investors can now participate with just €1,000 or €5,000, owning “digital bricks” that yield returns proportionate to their share.
Beyond lower investment thresholds and global accessibility, tokenization introduces greater liquidity. Unlike traditional real estate, tokenized shares can be traded more freely, offering investors an exit strategy. Transactions can also be faster and cheaper, with fewer intermediaries involved.
Each token serves as a secure proof of ownership, recorded on an immutable public blockchain. This reduces fraud, removes paperwork, and enhances transparency.
That said, tokenization still exists in a regulatory gray area — though this is evolving. In Europe, the Markets in Crypto-Assets Regulation (MiCA), fully effective since December 2024, establishes a harmonized framework for crypto-assets across the EU. MiCA classifies tokenized assets as regulated financial instruments, mandating strict compliance, transparency, and investor protection.
Of course, blockchain technology comes with its own risks — such as vulnerabilities and cybersecurity threats. Strong security protocols are essential to mitigate these.
Another key challenge is assigning fair market value to fractional, tokenized assets. Tokens for a €3 million building don’t benefit from the same market dynamics as publicly traded stocks. Moreover, these assets lack regular reporting. Real estate valuation is possible but expensive. If frequent valuations are required to price tokens, costs could rise significantly — without added value for long-term token holders.
Platforms can support users in initiating group ownership of virtually any high-value item:
Define the item, price, location, usage conditions, and co-ownership criteria (e.g., min/max investment, share distribution, number of co-owners)
Invite co-investors with defined share structures
Sign legal agreements via smart contracts
Finalize the purchase and register co-owners through a notary
Insure and manage co-usage
Enable co-owner ratings to build trust
While the earlier examples assume a single occupant and several financial co-owners, other models exist. In some holiday parks, investors can buy vacation homes either for personal use (with the remainder of the year rented out) or for full rental. Some setups allow multiple co-owners to split personal usage periods throughout the year.
Then there’s the sharing economy. Some platforms offer rental services, while others enable collaborative ownership — like sharing a car or lawnmower with neighbors. For more on this, see my blog post "Rental and Sharing-economy — Where does it start and where does it end, and how does it relate to the financial sector?" (https://bankloch.blogspot.com/2023/03/rental-and-sharing-economy-where-does.html).
Ultimately, these platforms create new investment opportunities and provide innovative ways for people — even those with limited means — to access assets traditionally reserved for the wealthy. This democratizes ownership.
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