Scandinavian Working Papers in Economics
Working Paper Series,
Royal Institute of Technology, Department of Real Estate and Construction Management & Banking and Finance
No 23/6: Real Estate Security Token Offerings and the Secondary Market: Driven by Crypto Hype or Fundamentals?
Julia Kreppmeier (), Ralf Laschinger (), Bertram Steininger () and Gregor Dorfleitner ()
Additional contact information
Julia Kreppmeier: University of Regesburg, Germany
Ralf Laschinger: University of Regensburg, Germany
Bertram Steininger: Department of Real Estate and Construction Management, Royal Institute of Technology, Postal: Teknikringen 10B, 100 44 Stockholm, Sweden
Gregor Dorfleitner: University of Regensburg, Germany
Abstract: Tokens, the digital form of assets, are an innovation that has the potential to disrupt how to transfer and own financial instruments. We hand-collected data on 173 real estate tokens in the USA between 2019 and 2021 and trace back 238,433 blockchain transactions. We find that tokens provide broad real estate ownership to many small investors through digital fractional ownership and low entry barriers, while investors do not yet hold well-diversified real estate token portfolios. We analyze the determinants of the success of security token offerings (STOs), secondary market trading, and daily aggregated capital flows. In addition to some property-specific determinants, we find that crypto-market-specific determinants, such as transaction costs and the related sentiment, are relevant both to the STO and capital flows.
Keywords: digital asset; security token offering (STO); real estate token; blockchain; distributed ledger technology (DLT); decentralized finance
JEL-codes: G24; G32; K22; L26; M13
Language: English
41 pages, June 9, 2023
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