Cryptocurrency and Real Estate?
A cryptocurrency is a digital asset which is secured by cryptography, which utilizes encryption technology preventing fraud such as counterfeiting. Although not yet officially recognized as legal tender in the U.S., it operates as currency and some as a form of asset investment.
Cryptocurrencies are based in a decentralized network built upon blockchain technology, which is a digital distributed ledger that cannot be tampered or changed due to the intricate network of computers involved. Because of the decentralized structure, cryptocurrencies are not issued by any central authorities thus making government interference or manipulation practically impossible… That doesn’t mean the IRS won’t tax you on your trades though.
The most widely known cryptocurrency is Bitcoin, but there are a multitude of others (17,596 to be exact as of right now according to Coinmarket cap) each with their own pros and cons. A few other examples that have been making headlines you may have heard of are: Ethereum, Cardano, Shiba Inu, and MANA.
But the advantage of utilizing cryptocurrencies include faster international money transfers with little to no fees depending on the type of crypto used. Digital currency has come a long way since 1983 and is now seen as a technology that will disrupt many industries. Just look at the recent first real estate NFT transaction by a company called Propy which was tied to a real property in Florida. There are still numerous challenges we face such as crypto owners that became victims of phishing attacks, crypto scams, and exchanges hacked. However these can be mitigated by using security protocols, recognized service providers, legal compliance, and my personal favorite, education.
Now that the walls have been torn down we see more interest in adoption as this transaction in particular proved that it’s possible to utilize cryptocurrency with an NFT in a real world application instead of just buying digital monkey art or a shirt that says I bought this with crypto.
Article by Ernest Urbanowicz, April 20, 2022.