Bitcoin and other cryptocurrencies have been dominating the airwaves over the past couple of years. It was introduced to the world in 2009 from a certain Satoshi Nakamoto, whose identity hasn’t been identified until this very day. If you have invested Bitcoin during the early years, sure enough, you now have millions in cryptocurrency since Bitcoin has soared high. Even though cryptocurrency is such a volatile asset, it is being accepted with open arms by different industries. Now, consumers can buy goods and services with the use of Bitcoin and other cryptocurrencies available. Will it be the same with real estate?
What is Bitcoin anyway?
Bitcoin is a digital asset that is transacted through a blockchain or public ledger where transactions are recorded chronologically and publicly. So, if you have a bitcoin with you, there is a digital key encrypted on it to prove that you own a specific amount of Bitcoin. Often compared to gold, bitcoin is a finite asset, meaning it was designed to only have 21 million Bitcoins to exist. Moreover, it can’t be made in an instant, unlike money. Instead, Bitcoin is mined by computers in order to release more bitcoins in the circulation.
Considered as an investment, Bitcoins be traded and be used as payment for certain goods and services from companies who have already embraced cryptocurrencies in their payment methods. Nowadays, some players in the real estate have accepted Bitcoin as payment.
Is this the future of Real Estate Buying & Selling?
In real estate, there are a few that show their price listings in Bitcoin or showing that they accept Bitcoin as payment. At first, people were discouraged from using cryptocurrencies since these are volatile assents–it can be worth a higher value today and crash tomorrow. Another complication is that the settlement process can take weeks or months, making Bitcoin have a different value on the contract date and at settlement.
Through blockchain, a leasing or purchase agreement contract for a property or real estate will be in the form of codes that the purchaser will own. This is a deviation from the traditional format of contracts which is in paper. This is called a “smart contract” and it will self-process in a blockchain system for real estate— meaning minus the costly paperwork process when it comes to processing the legalities of real estate buying and selling. Blockchain presents a system where real estate buying / selling will be self-processing through automation.
In Australian real estate, the workaround of business brokers victoria is to show the prices in Australian Dollars and accept Bitcoin with the same value when exchanged. Even though this is the case, the Australian government is still reluctant in accepting Bitcoin in terms of property transactions, pushing it to happen in the far future.