Bitcoin is creeping into the real estate market and the risks are real – VICE News

Just a few years ago, Carol Cassis and Stephan Burke of Brown Harris Stevens were like any other high-end Miami realtors, facilitating million-dollar transactions of high net worth investors, athletes, celebrities and rich foreign buyers looking to park their wealth in southern Florida’s booming luxury real estate market.

Then in late 2015, the duo met a buyer who had a rather odd request — he was looking to purchase a home only through Bitcoin and needed a seller who would play along. The buyer ended up having to convert Bitcoin to cash to buy a property, but Cassis and Burke were intrigued. Bitcoin, at that point, was not nearly at the valuations they are at today, but the mania was building.

“We started studying it and paid close attention to Bitcoin’s value. We wanted to understand what it would take to use cryptocurrency to buy or sell property… how it would work from the legal side,” Stephan Burke told VICE Money over the phone from Miami.

In late 2017, Burke and Cassis clinched a deal. Bitcoin investor Michael Komaransky sold his sprawling seven bedroom Miami mansion for $6 million, or 455 Bitcoin, marking the biggest Bitcoin-to-Bitcoin real estate transaction to date. The deal was formalized on January 8 and the buyer, according to Burke, made Bitcoin payments in increments.

“We wanted to show those people that it’s possible to do [a high-end sale],” Cassis told real estate newsletter The Real Deal at the time. “It’s possible to do it in a legal frame, in a perfect way, when you have the right team doing it.”

Just a few years ago, Carol Cassis and Stephan Burke of Brown Harris Stevens were like any other high-end Miami realtors, facilitating million-dollar transactions of high net worth investors, athletes, celebrities and rich foreign buyers looking to park their wealth in southern Florida’s booming luxury real estate market.

Then in late 2015, the duo met a buyer who had a rather odd request — he was looking to purchase a home only through Bitcoin and needed a seller who would play along. The buyer ended up having to convert Bitcoin to cash to buy a property, but Cassis and Burke were intrigued. Bitcoin, at that point, was not nearly at the valuations they are at today, but the mania was building.

“We started studying it and paid close attention to Bitcoin’s value. We wanted to understand what it would take to use cryptocurrency to buy or sell property… how it would work from the legal side,” Stephan Burke told VICE Money over the phone from Miami.

In late 2017, Burke and Cassis clinched a deal. Bitcoin investor Michael Komaransky sold his sprawling seven bedroom Miami mansion for $6 million, or 455 Bitcoin, marking the biggest Bitcoin-to-Bitcoin real estate transaction to date. The deal was formalized on January 8 and the buyer, according to Burke, made Bitcoin payments in increments.

“We wanted to show those people that it’s possible to do [a high-end sale],” Cassis told real estate newsletter The Real Deal at the time. “It’s possible to do it in a legal frame, in a perfect way, when you have the right team doing it.”

Skeptics of cryptocurrency would balk at mere thought of involving Bitcoin in a long-term asset as steady as real estate. The most obvious risk is Bitcoin’s sharp volatility — what if your 455 Bitcoin was worth $6 million on the day you signed papers to purchase that mansion, and just $2 million a few hours later? From the seller’s perspective, how can you really trust that the buyer will really have enough Bitcoin to complete the transaction?

The intersection of cryptocurrency and real estate is indeed virgin terrain, but there is little doubt that interest is growing. Rapidly, at that.

At the sixth annual North American Bitcoin Conference held in Miami this year, realtors were out in full force, according to Cassis, eager to learn as much as they could about cryptocurrency in light of growing interest from real estate investors. An upcoming “Real Estate, Bitcoin & Wealth” conference in Toronto this April boasts the likes of Sylvester Stallone, former baseball star Alex Rodriguez, and Shark Tank’s Daymond John. On the agenda — Bitcoin investing, Bitcoin mining, and flipping properties.

There’s even an International Blockchain Real Estate Association, which was in fact founded back in 2013 with the intent of providing educational resources directed at “implementing blockchain in real estate”. That’s arguably more complex from simply using cryptocurrency to buy or sell property — blockchain experts say that the technology could play a pivotal role in the real estate market because of its ability to streamline processes.

“Our first year at the Bitcoin-real estate conference, there were no more than 300 people. Last year there were 3000 people,” Cassis told VICE Money. “This is not a game. There are very serious people behind it who see that this is big business.”

But in…

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