Bitcoin, a form of digital money powered by blockchain technology, is becoming an alternative way to pay for regular things. Over 100,000 merchants worldwide accept bitcoin as a form of payment including Microsoft, Overstock.com and Expedia. The housing market is an industry that recently started recognizing transactions can be done using this form of cryptocurrency.
The first single-family home sale, announced in 2017, was in Texas. According to an article published by CNBC.com, the broker stated the parties involved used a global payment service, BitPay, that converts bitcoin into cash. The seller preferred to receive the funds in US dollars.
A property search in Volusia County for “bitcoin” or “cryptocurrency” remarks in the statewide MLS Advantage, available to all Florida REALTORS, returns only one single-family home located in Osteen, Florida indicating the seller is willing to consider offers in bitcoin. REALTORS and affiliate members of the New Smyrna Beach Board of REALTORS have heard of cryptocurrency and some members can report working with customers exploring the use of this form of payment.
“My bitcoin investment will make my first home purchase possible,” stated a current buyer searching in New Smyrna Beach. “I plan to convert bitcoin for my down payment.”
Blockchain technology, a digital ledger where transactions made by cryptocurrency are recorded chronologically and publicly, is not only the foundation for cryptocurrencies. It can also be used for smart contracts. It can be used to transfer currency, but it can also be used to turn other assets, such as intellectual property, real estate, ownership-claims, insurance and much more, into digital “value.”
According to an article published in REALTOR Magazine, official magazine for the National Association of REALTORS (NAR), “if property titles could be secured in the blockchain technology, it could transform and speed up the mortgage and title process. It could also lessen fraud by preventing the forgery of documents.”
The International Blockchain Real Estate Association (IBREA) is working toward ambitious initiatives to transform the real estate industry. It’s seeking to create universal platforms that are “open source, nonprofit, secure and scalable” for property and title, as well as for digital deeds. Insurance and other essentials of real estate transactions could also be added to the blockchain. The IBREA hopes to promote and set standards for real estate transactions using cryptocurrency and set up industry best practices for the escrow process.
For more information, visit Bitcoin.org/en/FAQ for answers to frequently asked questions.