RealT, a Florida-based startup run by brothers Jean-Marc and Remy Jacobson, pitches itself as a democratizer of real estate. Through blockchain tokenization, they slice up Detroit homes into digital tokens, selling fractional ownership to investors across the world for as little as $50 a piece. Investors receive supposed “rental income” via crypto payouts, and the tokens can be traded on secondary markets. The sales pitch is intoxicating: own real estate without a mortgage, diversify globally, and earn passive yield.
In theory, this looks like a fresh frontier for investors locked out of traditional real estate. You don’t need hundreds of thousands for a down payment—you need a Coinbase account and some spare tether. That’s where the money glimmers. Tokenization promises liquidity in the least liquid asset class: real estate. If it worked, you could build cash-flow portfolios at scale, flipping fractions of homes like penny stocks.
But what’s playing out in Detroit is not democratization. It’s extraction, slumlord capitalism dressed up as fintech innovation.
In July 2023, RealT sold tokens representing ownership in 39 Detroit homes, raising $2.72 million—more than double the actual purchase price of $1.1 million. The kicker? The company never finalized the property purchases—the deeds still sit with the original sellers (Michigan Public). Investors own nothing but digital air, while RealT keeps the cash flowing.
This wasn’t an isolated mistake. Across Detroit, RealT has tokenized over 500 homes and claims to manage 1,600 rental units (Bridge Detroit). The results: tenants report black mold, broken plumbing, nonexistent leases, and sudden evictions. The city has filed its largest nuisance abatement lawsuit in history, targeting 408 RealT properties for code violations and millions in unpaid taxes (Bridge Detroit).
Investors, meanwhile, are left wondering if the “dividends” they receive are real rental income—or just a Ponzi-style reshuffling of fresh capital (AInvest).
Here’s what’s really happening: capital is circling like a vulture over Detroit’s working class. Instead of reinvesting in housing as shelter, RealT transforms homes into speculative chips, bought and sold by faceless investors in Europe, Asia, and South America. Tenants—mostly poor and Black Detroiters—become guinea pigs in a crypto experiment, stripped of stability while their homes are carved into yield-bearing commodities.
It’s the perfect parable of late capitalism: the working class pays rent, capital siphons it off, and investors in Paris or Singapore brag about “Detroit exposure” in their wallets. Marx couldn’t have dreamed up a clearer example of use value subordinated to exchange value.
And yet—this is exactly why people like us can thrive. These schemes reveal how desperate capital is to financialize every corner of life. The financial markets are starving for yield, for the next product they can turn into a derivative. That desperation means cracks, inefficiencies, opportunities. If you understand both the hustle and its contradictions, you can step in—not to be the slumlord, but to build your own parallel plays: alternative community trusts, crowdfunded co-ops, even activist-driven arbitrage. Capitalism is ugly, but its ugliness is fertile ground.
Despite the lawsuits, there are still financial mechanics here that are real:
- Fractionalization Liquidity – If secondary markets around tokenized assets mature, flipping fractions of properties could look more like trading equities. Investors who understand timing could arbitrage liquidity gaps.
- Geographic Arbitrage – Detroit property remains cheap by U.S. standards. If tokens ever map onto real deeds (a big if), the appreciation potential is significant.
- Rental Yield – In principle, Detroit homes can generate double-digit rental yields compared to pricier markets. The problem is execution, not math.
But every investor should ask: are you profiting from value creation, or from exploitation? Because right now, this is not wealth creation—it’s wealth extraction.
Who’s Fighting Back
- The City of Detroit: suing to bring 408 homes into compliance, framing RealT as a public nuisance.
- Outlier Media & local journalists: doing the hard work of exposing the scheme (Outlier Media).
- Tenants: speaking out about living conditions, demanding accountability, comparing RealT to absentee slumlords (WXYZ Detroit).
- Investors themselves: some are suing RealT, others are labeling it a “Madoff-style fraud.”
RealT is both a warning and a signal. It shows how far capital will go to monetize poverty—and how fragile these systems are once exposed. For organizers, it’s fuel for tenant unions and cooperative housing. For cynical investors, it’s proof that “innovation” often just means reinventing the slumlord with shinier branding. For those of us caught in between, it’s a reminder: capitalism is grotesque, but it leaks. And when it leaks, those paying attention can drink from the spill.
