RealT, a Florida-based firm known for tokenizing real estate, is now under legal fire after allegedly offering crypto-based shares of Detroit properties it didn’t actually own.
The company reportedly raised millions by selling tokenized stakes in 39 homes, despite never finalizing the purchases.
The issue first surfaced after local authorities in Detroit filed a lawsuit citing code and tax violations involving more than 400 properties tied to RealT. Though the firm does own hundreds of homes in the area, court documents claim it collected over $2.7 million from investors on homes valued at just $1.1 million—without ever transferring the deeds.
Further investigation uncovered additional cases where RealT offered tokens for properties it had no legal claim to, triggering fears of a wider pattern of misconduct. Investors were promised rental income from these properties, but many homes are vacant, blighted, or under rent controls, casting doubt on the financial viability of the entire model.
Critics argue this raises deep concerns about the RWA space, where flashy Web3 startups are venturing into complex real-world sectors like property management without the experience—or the infrastructure—to deliver. Some now warn that investor returns may be coming from new deposits rather than real rental profits, fueling comparisons to Ponzi schemes.
While regulators have shown growing interest in the RWA market, the RealT controversy is exposing just how fragile and opaque some of these tokenized investment models truly are.
Alexander Stefanov
Reporter at Coindoo
Alex is an experienced financial journalist and cryptocurrency enthusiast. With over 8 years of experience covering the crypto, blockchain, and fintech industries, he is well-versed in the complex and ever-evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His approach allows him to break down complex ideas into accessible and in-depth content. Follow his publications to stay up to date with the most important trends and topics.
Source: https://coindoo.com/crypto-firm-sued-for-selling-tokens-backed-by-non-owned-properties/