How Cryptocurrency and Blockchain Technology Can Affect The Real Estate Market
Cryptocurrencies such as Bitcoin and Ethereum have been gaining a lot of attention over the past year, largely due to their meteoric rise in value. They are starting to make waves in a lot of sectors and the real estate sector notwithstanding is primed to get disrupted in a way that could change it forever.
A cryptocurrency is a digital asset that has been assigned an arbitrary value. It is not something tangible that can be held like a coin or a bill. Instead, it uses encryption techniques that generate currency and verifies the transfer of currencies over highly secured blockchain networks.
Blockchains use a level of security that makes them highly secure, and while the mechanics are very complex, the basic idea is simple – to decentralize the storage of data so that such data cannot be owned, controlled, or manipulated by a central authority, and is very secure.
How can the real estate market be impacted by cryptocurrencies and their blockchain technology?
Buying or selling a home relies on the services of several professionals – lawyers, mortgage brokers, real estate professionals, to name a few, with every party being an integral component of the transaction. With the evolution of the blockchain platform and cryptocurrency, the need for all these players will be eliminated and buyers and sellers will experience a more affordable, quicker, and smoother transaction.
For anyone involved in a real estate transaction, the sheer volume of paperwork and procedure involved is very high. Blockchain technology will be able to shorten the time and costs involved in completing a deal – the transaction will become less arduous – effectively making real estate a more liquid asset that can be more easily and readily transacted.
In its most basic form, blockchain technology allows decentralize complex processes and enable them to be broken down into tokens. It can enable investors to buy and sell fractions of properties (as tokens), effectively lowering the barrier to entry and making investing in real estate affordable to all.
A huge advantage of blockchain technology is that the chances of fraud are virtually eliminated, as it is one of the most secure technologies available. Blockchain will make information easy to verify, giving buyers and sellers more confidence in the transaction.
We are leaders in the Vancouver luxury real estate market. If you are buying or selling your luxury home, make sure you contact us, and one of our experienced real estate professionals will be only to happy to assist.