For Real World Assets (e.g. Real Estate) to come on-chain (e.g. as NFTs), there needs to be a way of linking the physical to the digital object in a trustless way. This seems impossible. Who is tackling this and what are the solutions?

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An ownership deed to property can be represented digitally by an NFT (as long as that NFT is recognized as the source of truth). 

Property rights are associated with frameworks put in place by governments so there will always be some centralized authority though.