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How Cryptocurrency Is Changing The Real Estate World

Written by Posted On Thursday, 24 May 2018 13:15

The way we do real-estate business can change drastically in what, for many, may seem like the blink of an eye. As key players in the real estate industry, however, it is integral that investors, brokers, mortgage professionals, and agents keep their ears to the ground and eyes laser-focused on all the undercurrents that are taking place as we speak. One of the key developments that has already been making waves in the global real estate industry, is the oft-trending cryptocurrency.

Cryptocurrency is a leading digital asset that utilizes the intricacies of cryptography to serve as a medium of exchange for secure financial transactions, as well to verify the transfer of assets. It has been making waves in every industry, from the commonly-related finance industry, to the less-so healthcare industry. Changing times call for a change in narrative surrounding how we conduct real-estate transactions.

Outlined below are three ways in which cryptocurrency is shifting the landscape for the real-estate industry, while setting the pace for novel solutions to run-of-the-mill issues being developed:

  1. Cutting Down On Transaction Time

While the real-estate purchasing process has a longstanding reputation of being akin to a headache for all parties involved, and the steps involved show no signs of being revised in the near future, cryptocurrency has officially entered the space to make some changes that we may not have seen coming. Using codified techniques that are rooted in the complex techniques of cryptography, the time and costs involved between interest and that last signature on the dotted line can be condensed to a more convenient version.

Already leading the way in cryptocurrency real-estate transactions in California, The Crypto Realty Group, a Los Angeles-based firm lead by Piper Moretti, specializes in conducting real-estate transactions using this secure digital medium. A licensed and well-recognized REALTOR®, as well as an advisor for multiple burgeoning startups within the cryptocurrency space, Moretti strongly believes in blockchain technology taking over the real-estate industry within the next five years. Everything from loan documents and disclosures, to payment gateways and crowdfunding opportunities, is expected to be accessible via blockchain technology. According to Moretti, “What would normally be a thirty-day escrow could close in as little as three days.”

  1. Changing Face Of Real-Estate Laws & Regulations

Despite the quizzical expressions that may cross many faces when discussing the use of bitcoin and other cryptocurrency to conduct real-estate transactions, it is completely within the scope of the law to do so, as long as all parties involved are on board with this decision. It is undoubtedly challenging to source title companies, banks, and other key real estate players that are not only familiar with cryptocurrency, but also have a working knowledge to conduct real estate transactions.

The concept of using cryptocurrency is still very new, and the laws have yet to fully make changes to accommodate this new technology. The great news is that states such as Wyoming, Arizona and California have already begun the process of introducing legislation that will recognize blockchain-based technology as legal forms of record-keeping and payment exchange, so more title companies and city clerks will be coming on board in the near future to make the process much more streamlined.

One word of advice that Moretti is quick to highlight is that all parties involved within any real-estate transactions should always conduct their own research in an effort to minimize the possibility of scams. This goes for transactions, whether or not cryptocurrency is involved.

Bitcoin may be used for either the downpayment or entire purchase of a property, but prevailing real estate laws and regulations have ultimate authority. Nationwide, legislators are working to implement additional regulations and guidelines to provide protections for cryptocurrency-based transactions. While they are not yet quite as robust as they need to, as well as have the potential, to be, the change is in the air.

  1. Verifying Legitimate Buyers & Sellers

While it remains to essential to the real-estate investment process that buyers and sellers are both legitimate, cryptocurrency allows for a breaking down of barriers for non-traditional buyers to legitimately participate in the real-estate industry. With anonymity being intrinsically valued within the cryptocurrency space, it is important that both buyers and sellers do their due diligence when verifying all parties and assets involved.

With blockchain technology’s ability to act as a trustworthy means of recordkeeping, the potential for securely controlling and verifying sensitive identity information is tremendous. The increasing popularity of cryptocurrency as a means for conducting real estate transactions has created an even greater need for digital identity verification to be streamlined in a secure and simple manner. With more solutions being made available for encrypted identity management, individuals have great control over the sensitive information that they are willing and able to share, while giving others on the other end of a transaction some relief that the information is accurate and secure.

While there should always be homework done before jumping into the largely-unfamiliar pool of real-estate and cryptocurrency, the rapidly changing narrative behind what it means to conduct transactions through alternative mediums is making ample space for cryptocurrency to make constructive disruptions. The space is open and prime for companies, such as The Crypto Realty Group, CPROP.io and Block66, to identify the issues that currently exist, and build upon blockchain technology to deliver effective solutions.

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James Stevenson

Hi, My name is James and I've been involved in the property and real estate industry for 10 years now. I hope people will like to read about my thoughts and experiences in the industry and please contact me if you want to discuss my articles further!

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