GELEPHU: The Gelephu Mindfulness City (GMC) will introduce land tokenisation as a new ownership model to allow affected landowners to benefit from future increases in property value as the city expands.
Land tokenisation, a concept still in its infancy globally, involves converting ownership rights into digital tokens, typically on a blockchain platform. These tokens, much like other digital assets, can be bought, sold, or traded.
Under tokenisation, instead of selling land outright, landowners will retain a digital token securing their stake, even though physical ownership will be transferred to GMC. This approach allows land owners to benefit financially from future appreciation of the land’s value.
While global experts are still refining land tokenisation for GMC, this evolving concept is considered due to its future prospects and the long-term benefits it could pass down to current landowners for generations.
“Land tokenisation is a very new concept, redefining land ownership anchored on smart contracts,” Dr Lotay Tshering said during a recent virtual event hosted by Bhutan Global Mindfulness and MICE. “No nation has done this at such a scale. Details are evolving, and it should not take long before they are made public.”
Without land tokenisation, the governor warned that both current landowners and their heirs will remain dissatisfied, which, on a larger scale, means public discontent with GMC.
Traditionally, land has been sold to those with the means and foresight to anticipate urban growth, leaving many sellers regretting their decisions as property values later skyrocket.
In the GMC’s case, land values are projected to appreciate at an unprecedented rate.
“His Majesty feels very strongly that even if landowners today are offered the best compensation, they will feel dissatisfied in the future as land values soar,” Lotay said. “No land elsewhere will match the worth of GMC in the years to come.”
The governor said that the GMC is envisioned by His Majesty to open the economic window of Gross National Happiness. “No human being can thrive without some degree of material well-being,” he said, adding that economic progress is a fundamental aspect of human fulfillment.
If the GMC is to compensate affected landowners monetarily, it must adhere to the Property Assessment and Valuation Agency (PAVA) rate or the current market rates in sale deed agreements, which are legally binding in land sale and purchase transactions.
While the PAVA rates are low, market transactions are often underreported to avoid the three per cent land transfer tax, distorting true land values. - Kuensel/ANN
