Inefficient Existing Alternatives

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

✅ 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).

✅ 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

Last updated 8 months ago