Inefficient Existing Alternatives

Fractional investment and real estate tokenization do not go far enough.

Fractional Real Estate Investing

✅ Solves access to investment by enabling small ticket sizes, but:

• ❌ No leverage, making it unattractive for large portfolios and less efficient for all investors.

• ❌ Opaque cash flow management with no control over property management.

• ❌ No secondary market liquidity for exits.

• ❌ Dependence on centralized intermediaries (risk of platform failure, KYC).

Tokenized Fractional Investment

✅ Allows DeFi leverage via lending/borrowing loops, but:

• ❌ Higher and variable DeFi interest rates compared to traditional loans, reducing profitability and predictability.

• ❌ Risk of liquidation in volatile real estate market conditions.

• ❌ Variable loan conditions depending on crypto market fluctuations, not real estate market.

• ❌ Loans are structured as interest-only (bullet loans) instead of amortizing loans, creating long-term risk. This means that as long as the debt remains unpaid in full, there is a risk of losing the entire property.

Criteria	DeFi Real Estate Lending	Tulpea Tokenized Real Estate Credit
Loan Structure	❌ Bullet loan (only interest payments until closure)	✅ Amortizing loan (gradual capital + interest repayment)
Monthly Payments	⚠️ Interest payments only (sometimes fees), no capital repayment	✅ Monthly repayment of capital + interest
Liquidation Risk	⚠️ Yes, if collateral (REBT) loses value	✅ No
Repayment Term	⏳ No fixed term, potentially perpetual debt	✅ Defined loan duration (e.g., 10, 15, 20 years)
Final Ownership	❌ Always dependent on the loan unless fully repaid	✅ 100% ownership