Real Estate: Buy Your Home Using Cryptocurrency as Collateral – BeinCrypto

Real estate: Instead of selling their crypto assets to buy a house, crypto investors can use them as collateral, explains Troy HuertaCEO By Brix.

After several months of rising prices, the US real estate market may soon calm down. Fed Chairman Jerome Powell said last week that activity in the real estate sector has declined.

In contrast, the Fed’s latest interest rate hike has had a positive impact on cryptocurrency prices. This is a good sign for the cryptocurrency market, which has been subject to high volatility in the past few months.

While their trajectories are likely to be different, these two seemingly dissimilar sectors have one thing in common: opportunity. The real estate market is currently offering crypto investors an unprecedented opportunity to enter the underserved crypto lending market. Now they can use their digital assets to buy real estate.

Real Estate and Cryptocurrency

Longtime investors who have accumulated crypto assets over the years have weathered many storms, including the current market turmoil. This is probably not the time to sell your crypto assets. However, savvy investors need to find ways to make their crypto reserves work. Some types of home loans allow investors to use this cryptocurrency as collateral to buy a house.

Gradually, players in this sector are creating the necessary infrastructure to conduct this type of transaction. This is done in order to give cryptocurrency holders the opportunity to maximize the potential of their assets.

ByBrix is ​​one of those players. It is a recently launched joint venture between crypto app Blimp Homes and DeFi incubator AQRU. ByBrix guarantees digital assets and will allow their owners to use them when buying property in the UK, Canada, Australia and the US.

Use your cryptocurrency as collateral

Instead of selling their crypto assets to buy a house, crypto investors can use them as collateral. Thus, they can continue to benefit from any future growth in their crypto investments. In addition, they will not pay transaction costs associated with the sale, as well as any possible capital gains taxes. Indeed, instead of converting cryptocurrency into fiat currency, the platform keeps it safe until the borrower repays the loan.

In this solution, the cryptocurrency plays the role of collateral for the deposit paid to the seller of the house. There are also other credits that cover the remainder of the purchase amount (provided by specialized vendors through ByBrix). This separates a home loan from a cryptocurrency collateral. Therefore, if the house is seized, the collateralized cryptocurrency will not be affected.

To fully understand the opportunities provided by crypto lending would require a great deal of education in real estate and digital assets. Indeed, the mechanics of these instruments has nuances. All stakeholders – from potential borrowers looking to leverage their crypto wealth to intermediaries like brokers and even regulators – will need time and help to embrace this new mindset. Just as cryptocurrencies have changed our definitions of money and currency, crypto lending has the potential to redefine the value proposition of the real estate industry.

about the author

Troy Huerta is the CEO of ByBrix, a financial platform specializing in real estate purchases backed by cryptoassets.

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All information on our website is published in good faith and for general informational purposes only. Any action taken by the reader based on information found on our website is done solely at his own risk.

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