Institutional investors are expected to purchase blockchain-tokenized shares of high-value commercial real estate, according to Kunal Bhasin, digital asset co-lead at KPMG Canada.

Speaking at the Toronto Collision Conference, Bhasin highlighted that tokenization could revolutionize ownership of major commercial buildings, traditionally limited to wealthy real estate and pension fund managers.

The technology could enable institutional investors, such as family offices, to own parts of prominent properties like Toronto’s Eaton Center. Bhasin forecasts this will become a significant institutional use case for the crypto industry.

However, he emphasized that many institutional DeFi players would prefer to operate in a more regulated environment, where they know their transaction partners, incorporating essential know-your-client checks.

While tokenized real estate adoption is gradual, Bhasin cited Bitfinex Securities’ tokenized asset raise for a Hampton by Hilton hotel in El Salvador as a step in this direction, despite raising only a fraction of its target. He also noted the success of BlackRock’s USD Institutional Digital Liquidity Fund, which has accrued significant value since its launch.

Despite concerns about reputational risks due to fraud and scams in the crypto space, Bhasin observed progress. KPMG uses blockchain analytics from Chainalysis to detect potential illicit activities, a practice that could encourage more banks to engage with crypto assets. Bhasin concluded that avoiding crypto could soon pose a career risk, as competitors who embrace digital assets gain a competitive edge.