X-Bit: Democratizing Real Estate with Blockchain-Powered Fractional Ownership and Tokenized Transactions
1Indian Institute of Technology, Dhanbad, Jharkhand, India
A Paper Submitted in Partial Fulfilment of the Requirements for IBCOL 2023
Sustainable Development Goals
Keywords
Abstract
In the face of soaring real estate costs, property ownership remains a distant dream for many. However, a transformative solution emerges through the integration of blockchain technology, exemplified by X-bit. This innovative platform empowers the broader population to invest in real estate by dividing properties into fractional shares. Sellers tokenize their properties, creating, for instance, 10 partitions, each representing a portion of the whole, priced at x/10 of the original property's valuation.
A novel approach to setting selling prices is implemented through a decentralized consensus mechanism where the price is determined by the highest voted value, often exceeding the property's original worth. This equitable appreciation benefits all token holders. When a buyer expresses interest, a further consensus mechanism takes place. To proceed with the sale, a majority agreement of over 50% is required among token holders to decide whether to sell to the prospective buyer.
Additionally, this revolutionary concept allows original property owners to set royalty fees on each token's resale. This royalty fee mechanism ensures that the seller continues to benefit from the appreciation of the property even after the initial sale.
Furthermore, this project is powered by the ERC1155 token standard, allowing for batch minting. Sellers can list all the plots/parts of their real estate simultaneously, streamlining the process and enhancing user convenience. This project not only democratizes real estate investment but also promotes a decentralized and participatory approach to wealth creation in the real estate market, all while providing a sustainable means for property owners to receive ongoing benefits from their real estate assets. It represents a significant step towards an inclusive, decentralized real estate ecosystem where the power of blockchain technology is harnessed to facilitate property ownership for a wider audience.