Crypto real estate company cedes control of portfolio to third party

May 2, 2026 - 21:39

The city of Detroit has reached a settlement with RealT, a company that sold tokenized shares of rental properties using cryptocurrency, requiring the firm to hand over control of its entire portfolio to a third-party receiver. The agreement comes as part of a lawsuit filed by the city over blight and property code violations.

RealT had marketed itself as a way for investors to buy fractional ownership in Detroit houses through blockchain tokens, promising rental income and potential appreciation. But city officials argued that the company failed to maintain the properties, leading to deteriorating conditions in several neighborhoods. The lawsuit accused RealT of allowing buildings to fall into disrepair, with issues including broken windows, overgrown lots, and structural damage.

Under the settlement, RealT will cede management authority to an independent receiver appointed by the court. The receiver will oversee repairs, handle tenant issues, and eventually sell the properties. The company will also pay a fine to the city. Detroit's law department stated that the deal ensures the homes will be brought up to code and that residents will no longer suffer from neglected buildings tied to speculative crypto schemes.

The case highlights growing friction between municipal governments and blockchain-based property ventures. While tokenized real estate promised to democratize investing, critics say it often sidesteps traditional landlord responsibilities. For now, Detroit's move sets a precedent: if you sell digital shares of a house, you still have to fix the roof.