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Tokenized Securities: What a Property Token Actually Represents

A property token is a record on a blockchain of who holds an interest in something. The something is almost always a membership interest in a limited liability company that owns one property, and the token changes how the interest moves, not what it is. Lofty records LLC interests on Algorand and trades them in USDC, RealT recorded series LLC interests on Ethereum and Gnosis until its liquidation in July 2026, Binaryx uses a Wyoming DAO LLC per property on Polygon, Mogul runs per-property LLCs as investment clubs, and MeyReal issues property-backed NFTs that its terms call certificates of contractual rights. This page explains what each token represents, which rules if any the issuer relies on, who may buy, how the markets work, and what the RealT episode showed about tokens with thin markets.

A Detroit brick duplex at dusk, porch light on, street empty
“The chain records who holds it. The LLC decides what it is worth.”By ·

Who uses this structure on Threeworld

  • Mogul

    A membership interest in a per-property LLC run as an investment club, taxed as a partnership. Not a registered securities offering

    None named. Mogul says it is not a registered broker-dealer or adviser and cites no Reg D or Reg A exemption. Mogul fee post, checked October 24, 2026.

  • Lofty.ai

    Fractional membership in a separate LLC that owns each property, recorded as tokens on Algorand and traded in USDC. Lofty AI, Inc. runs the marketplace and says it is not a registered broker-dealer, adviser or exchange

    Regulator not published. Lofty, how it works, checked October 24, 2026.

  • Binaryx

    Each property sits in its own Wyoming DAO LLC, and the ERC-20 token on Polygon is a share of that LLC with a vote in the property's DAO

    None. Offered outside the US under Regulation S, US residents excluded. Binaryx says its counsel view the tokens as non-securities and that it is not a registered broker-dealer. Binaryx docs, checked October 24, 2026.

  • MeyReal

    Property-backed NFTs issued per asset. The legal page describes each token as a certificate of contractual rights against a local company that holds the title deed, coordinated by an offshore hub. The terms of use say the tokens confer no ownership, securities or income rights unless an offering's own documents grant them, so treat what you hold as a contractual claim rather than a share of the property

    Regulator not published. Mey Real legal framework, checked October 24, 2026.

  • RealTIn liquidation

    RealTokens were ERC-20 tokens representing membership interests in a per-property series of RealToken LLC, a Delaware series LLC managed by RealToken Inc., with the series holding the deed. Sold to US accredited investors under Regulation D and to non-US persons under Regulation S, never registered with the SEC

    None. SEC private placement exemptions (Regulation D and Regulation S), not registered. RealT website general disclaimer, April 2022, checked October 24, 2026.

Table of contents

What You Actually Own

Strip the token away and what remains is a company document. Lofty's registry row describes fractional membership in a separate LLC that owns each property, recorded as tokens on Algorand and traded in USDC. RealT's tokens were membership interests in a per-property series of RealToken LLC, a Delaware series LLC, with the series holding the deed. Binaryx puts each property in its own Wyoming DAO LLC and the ERC-20 token is a share of that LLC with a vote in the property's DAO. Mogul sells a membership interest in a per-property LLC run as an investment club and taxed as a partnership. MeyReal is the exception that proves the rule. Its legal page describes each NFT as a certificate of contractual rights against a local company that holds the title deed, coordinated by an offshore hub, and its terms of use say the tokens confer no ownership, securities or income rights unless an offering's own documents grant them. So the same word, token, covers an LLC share with a vote and a contractual claim with no rights by default. The operating agreement or offering document, not the blockchain explorer, tells you which you hold.

Which Rules Apply, If Any

A token that represents an LLC interest sold to investors is a security in most jurisdictions, and the issuers on this page handle that in four different ways. RealT relied on US exemptions, Regulation D Rule 506(c) for accredited Americans and Regulation S for non-US persons, and never registered with the SEC. Binaryx sells only outside the US under Regulation S, excludes US residents, caps one holder at 5% of a property, and says its counsel view the tokens as non-securities while confirming it is not a registered broker-dealer. Lofty names no regulator and no exemption in its public pages, and says Lofty AI, Inc. runs the marketplace without being a registered broker-dealer, adviser or exchange. Mogul names no regulator and cites neither Regulation D nor Regulation A+, describing its LLCs as investment clubs. The common thread is that no regulator has reviewed the offering. The variation is in whether the issuer has named the exemption it believes covers it, which decides who may buy and what disclosure you can expect. The regulation of the chain itself, Algorand or Polygon, is irrelevant to any of this.

Who Can Buy

It depends entirely on the issuer's chosen position. Lofty onboards US and international investors after identity checks with no wealth test. Binaryx takes non-US investors only. RealT took verified accredited Americans and non-US persons. Mogul and MeyReal onboard after their own KYC. In every case your wallet is whitelisted, meaning the token contract only lets it move between addresses the issuer has approved, which is how an issuer keeps a Regulation S token from reaching a US buyer and how it can freeze a position if it needs to. The whitelist is also the quiet dependency. A token you hold in your own wallet still needs the issuer to keep running the list for anyone to buy it from you.

Order Books and Buybacks

Tokenized platforms sell on liquidity and some deliver more of it than any other structure in this hub. Lofty runs an exchange open around the clock, with limit orders matched between investors and market orders filled by market makers, no minimum holding period, 2.5% to buy and 3% to sell. Binaryx runs a peer-to-peer market and a spot order book priced within 10% of a reference price, once the primary sale is complete. MeyReal runs an NFT marketplace with an on-chain order book for KYC'd wallets. Mogul advertises a secondary market as coming soon and in the meantime you hold until a super-majority votes to sell the property. None guarantees a buyer. Lofty says a limit order fills only when another investor matches it. The guide to how you get your money out puts these beside exit windows and redemption programmes.

What RealT Showed

RealT was the proof of concept for this structure, more than 700 Detroit properties tokenized and roughly $140 million raised, with rent paid weekly in stablecoins. Its registry row now reads in the past tense. Rent payouts largely stopped in late 2025, the City of Detroit sued over 408 properties for unpaid taxes and blight, a court-approved fiduciary took control of the portfolio in April 2026, and on 2 July 2026 the company announced a voluntary liquidation. The website buyback and the exchange trading both closed. The tokens kept working throughout. Holders could see their balances on Gnosis Chain the whole time. What failed was the LLC layer underneath: the property management, the tax payments and the manager's solvency. A token is a perfect record of a claim and says nothing about whether the claim is good. Threeworld's account of what happened to RealT has the sequence and the sources.

What to Check Before You Buy

Find the operating agreement or offering document for the specific LLC and read what the token represents, including voting rights and the manager's powers. Identify the exemption claimed, if any. Search EDGAR for a Form D under the LLC's name. No filing and no named exemption means the issuer is relying on its own view of the law. Check who holds the deed. A series LLC, a Wyoming DAO LLC and a local company behind an offshore hub are three different distances between you and the property. Read the whitelist rules and what the issuer may do to a wallet it decides to freeze. Look at the order book depth for the specific property, not the platform's headline volume. Find the fees on the way in and out, which on tokenized platforms run from 0.5% to 5% a side, in the fees pillar.

Questions people ask

What does a real estate token actually represent?

Almost always a membership interest in a limited liability company that owns one property, recorded on a blockchain instead of a spreadsheet. Lofty, RealT and Binaryx all work this way. MeyReal's NFTs are different, a certificate of contractual rights that its terms say confers no ownership or income rights unless the offering documents grant them.

Are tokenized real estate platforms regulated?

Mostly not. RealT relied on US Regulation D and S exemptions without registering, Binaryx sells only outside the US under Regulation S, and Lofty and Mogul name no regulator or exemption on their public pages. In every case no regulator has reviewed the offering.

Can I sell real estate tokens any time?

On Lofty and Binaryx you can list any time on an on-platform order book, with a 3% or 5% fee on Lofty and Binaryx respectively, but a sale only happens when another investor buys. Mogul has no secondary market yet. No platform guarantees a buyer, and RealT's buyback closed when the company entered liquidation.

Did RealT token holders lose their tokens?

No, the tokens stayed in holders' wallets and visible on chain. What failed was the company beneath them: rent stopped in late 2025, Detroit sued over 408 properties, a fiduciary took the portfolio in April 2026 and RealT announced liquidation on 2 July 2026. The token recorded a claim on an LLC that could no longer pay.
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