A popular crypto expert has revealed why the Dubai government chose XRPL instead of Bitcoin for its real estate tokenization project.
Earlier this week, the Dubai Land Department (DLD) announced the launch of its first-ever tokenized real estate platform, Prypco Mint. This pioneering initiative has emerged through a collaboration with several entities, including Prypco, the Dubai Future Foundation, Ctrl Alt, and the Virtual Assets Regulatory Authority.
With this groundbreaking platform, investors can acquire fractional ownership in Dubai properties by purchasing tokenized shares linked to those assets. The minimum investment for these tokenized shares is set at 2,000 dirhams (approximately $540), making property ownership more accessible to a broader audience.
A critical aspect of this initiative has been the decision to utilize the XRP Ledger (XRPL) as the blockchain infrastructure for tokenizing title deeds. This choice will enable the establishment of a tokenized property market in Dubai, projected to be worth around $16 billion by 2033.
The selection of XRPL over other major blockchains, notably Bitcoin, has sparked significant discussion within the crypto community. Some experts and enthusiasts are left pondering the reasons behind this strategic decision.
Why the Dubai Government Chose XRPL Over Bitcoin for Its Real Estate Tokenization Project
In light of these questions, prominent social media influencer John Squire has dissected the rationale behind the Dubai government’s choice of XRPL, attributing it to “brutal efficiency” across six key dimensions.
Transaction Speed
Squire emphasized that the rapid transaction settlement of the XRP Ledger played a vital role in its selection. While XRPL facilitates transactions in a mere 3 to 5 seconds, a similar operation on the Bitcoin network can take anywhere from 10 minutes to an hour. This significant difference in speed is crucial for any real estate platform, where timely transactions can make or break deals.
Low-Cost Transaction
Another compelling reason for opting for XRPL is its remarkably low transaction cost. Squire pointed out that while Bitcoin transactions can involve substantial fees, transactions on the XRP Ledger are executed for a fraction of a cent. This economic advantage makes XRPL particularly appealing for real estate transactions, where cost efficiency is paramount.
Scalability
Scalability is yet another critical factor that led to the preference for XRPL. Squire highlighted XRPL’s capability to handle thousands of transactions per second, allowing it to process up to 1,500 transactions within just one second. In contrast, Bitcoin only manages around seven transactions during the same timeframe. This scalability aligns perfectly with the Dubai government’s long-term vision of supporting expansive real estate platforms.
Sustainability
In a world increasingly focused on sustainability, the eco-friendliness of XRPL stands out. The XRP Ledger operates using a consensus algorithm that does not rely on energy-intensive mining, aligning seamlessly with Dubai’s green initiatives. Conversely, Bitcoin, notorious for its proof-of-work algorithm, has drawn criticism for its substantial energy consumption, leading some countries, including China, to impose bans on Bitcoin mining.
Institutional Friendliness
Institutional friendliness further underscores XRPL’s suitability for Dubai’s project. Squire noted that Ripple, the company behind XRPL, has established partnerships with numerous banks, regulators, and governments. Many of these institutions are already integrated into the XRPL ecosystem, making it a more suitable choice for enterprise-level initiatives compared to Bitcoin, which often finds itself marginalized in significant undertakings.
Widespread Use Case
Finally, Squire pointed out that XRPL has demonstrated practical utility across various sectors, including cross-border settlements, stablecoins, Central Bank Digital Currencies (CBDCs), and tokenization. In contrast, Bitcoin mainly functions as a store of value, lacking the versatility needed for complex initiatives like real estate tokenization. For billion-dollar projects such as Dubai’s, utility-driven blockchains are often favored over those primarily guided by ideological narratives.
“Dubai chose XRP because it’s fast, cheap, scalable, energy-efficient, and institution-ready,” Squire concluded, illuminating the comprehensive rationale behind this transformative decision.
DisClamier: This content is informational and should not be considered financial advice. The views expressed in this article may include the author’s personal opinions and do not reflect The Crypto Basic opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.
