How Buying Property with Crypto is Revolutionizing the Industry
When you consider just how much of an impact cryptocurrency has had in recent years, it’s hard to find a sector that’s not been influenced by digital currency in some way or another.
In fact, statistics from 2022 show that 34 million US adults own cryptocurrency. This figure is expected to surge by double digits throughout this year. One thing is apparent; crypto is booming.
Naturally, we’ve seen savvy investors explore how they can leverage crypto in terms of their entire investment portfolio. And, they’ve found an outstanding opportunity in the form of purchasing property with cryptocurrency.
With that being said, in this blog post, we’re going to explore how purchasing property with crypto is revolutionizing the industry.
From BTC to ETH, an introduction to cryptocurrency
Before we take a look at the way in which cryptocurrency is revolutionizing the property market, it makes sense to establish what cryptocurrency is and some of the most popular coins in circulation.
Cryptocurrency is a type of virtual or digital currency. It doesn’t rely on banks to verify transactions. Instead, it’s a peer-to-peer system, enabling anyone around the globe to send and receive payments.
A cryptocurrency payment only exists as a digital entry in an online database, describing the specific transaction; in this case a property purchase. You don’t carry physical money, as is the case with fiat currency.
If you want to transfer your crypto coins to someone else, the transaction will be stored in a public ledger. Transaction records cannot be amended or deleted, which enhances security significantly.
The top five most popular cryptocurrencies at present are as follows:
Bitcoin (BTC) - $543.4 billion market cap
Ethereum (ETH) - $220.4 billion market cap
Tether (USDT) - $81.8 billion market cap
Binance Coin (BNB) - $50.6 billion market cap
U.S. Dollar Coin (USDC) - $30.4 billion market cap
What are the benefits of purchasing property with crypto?
Let’s be clear; cryptocurrency is in a position to revolutionize the industry because it offers distinct advantages in comparison to fiat currency. So, what are these benefits?
Enjoy flexible property investment around the world
When using fiat currency, there are a number of formalities and rules you need to adhere to. If you’re purchasing property in another country, this means more cost and more complexity.
Think about it: first of all, you need to exchange your currency to the currency used in the country you’re buying. You then have to consider the different rules and regulations that are in place.
The great thing about cryptocurrency is that it’s global. It’s borderless. Using crypto for a property purchase in the U.S. is the same as using crypto for a property purchase in Spain.
Complete your property purchase at a rapid pace
If you speak to a number of people who’re in the process of buying or selling a property, you’ll find that the number one concern amongst most is likely to be just how long it’s taking for the transaction to be finalized.
We’re talking weeks and sometimes even months before a property purchase is complete! That’s a long time to wait, right?
One of the reasons why cryptocurrency is causing such a disruption is because it offers rapid payment completion. Blockchain is one of the fastest ways of transferring money, offering a virtually instant property transaction.
You don’t have to jump through all of the hoops and red tape associated with money transfers, and this makes crypto incredibly attractive to most.
Have peace of mind that your transaction is secure
When something is new, we’re often worried that there’s great vulnerabilities! And, the sheer fact that blockchain purchases are so fast can cause concern too. However, you’ll be pleased to learn that crypto is also incredibly secure.
Blockchain transactions are theroretically much more difficult to hack, as all nodes (computers) in the network need to verify the transaction.
Every transaction is linked. This means you cannot delete or amend a transaction without hacking every single node in the blockchain. Plus, all blockchain transactions are immutable and can be viewed on a public ledger.
How is blockchain changing the real estate game?
Now that we’ve dipped our toes into some of the ways that cryptocurrency purchases are beneficial in the property market, let’s delve deeper into how these transactions are changing the industry.
New ways of trading real estate
Real estate technology has traditionally been concerned with two things:
Listings
Connecting sellers and buyers
Nevertheless, blockchain has now introduced new ways of trading real estate.
Blockchain enables online marketplaces and trading platforms to comprehensively support real estate transactions.
For instance, ATLANT has created a platform that utilizes blockchain technology to facilitate real estate and rental property transactions.
Through the tokenization of real estate, assets can then be traded, just like stocks on an exchange or other online transactions.
Bye bye intermediaries
The real estate ecosystem has long included banks, lawyers, and brokers. However, we may soon see a shift in these roles and their participation thanks to blockchain.
Functions such as legal documentation, payments, and listings can eventually be assumed by these new platforms.
By cutting out intermediaries, there are two clear benefits:
Transactions will be much quicker, as there’s no need for back-and-forth between middleman
You’ll get more for your money, as fees and commissions charged by these intermediaries will be eliminated
Further cost savings can be made
So, we’ve already established that cost savings can be made by removing the middlemen, but that’s not all.
Some of the costs involved in traditional real estate investment, which crypto can eradicate, are as follows:
Taxes associated with real estate
Loan fees
Registration fees
Inspection costs
These costs can differ depending on the territory that has jurisdiction. Just like intermediaries, these can be reduced or even eraidcated altogether with blockchain, as blockchain technology automates these processes and makes them part of system.
Greater transparency due to a decentralized network
Blockchain commands security and trust as it is a decentralized technology. Let’s breakdown what this actually means in real terms.
Data is immutable and transparent because all of the information stored in the blockchain can be accessed by all peers on the network.
And, you only need to cast your mind back to 2008 when the housing bubble crash revealed how a lack of transparency and sheer greed can have a catastrophic impact!
With a decentralized exchange, trust is in-built in the system. As data can be verifiable to peers, both sellers and buyers can have more confidence when carrying out transactions.
This should also mean that there are fewer fraud attempts!
Fractional ownership is permitted
Another way that purchasing property with crypto is revolutionizing the industry is by enabling fractional ownership. This lowers the barriers to entry.
Typically, you’ll need a significant amount of money upfront to obtain a property. Another option is to pool your money with others to acquire bigger ticket properties.
With blockchain technology, investors simply need to have access to a trading application to purchase and sell even fractions of tokens, as suits them and their investment objectives.
Furthermore, fractional ownership will also be beneficial in terms of helping them avoid managing properties themselves, such as leading and maintenance. After all, dealing with tenants and managing upkeep alone can be significant!
Access for all
Ultimately, the global real estate is worth hundreds of trillions of dollars, yet large, wealthy corporations dominate the sector. With blockchain technology, it’s possible that a greater number of people will be able to access a market where transactions are more equitable, secure, and transparent.
Crypto is revolutionizing the property industry, and it’s not hard to see why!
So there you have it: an insight into some of the different ways that buying property with cryptocurrency is revolutionizing the industry.
When you consider that crypto is able to facilitate much faster transactions with improved security, it’s not hard to see why it’s appealing.
However, there are still risks involved, and it’s important to be aware of this when determining whether or not using crypto to purchase a property is right for you.
One thing is for sure, though; we’re going to see cryptocurrency increasingly used in the world of real estate over the coming years.
Author bio (if needed):
Kerry Leigh Harrison has over 11+ years of experience as a content writer. She graduated from university with a First Class Hons Degree in Multimedia Journalism. In her spare time, she enjoys attending sports and music events.
