Jennifer Schonberger of Yahoo Finance explains why Magnum Real Estate only accepts bitcoin for three condos in Manhattan and the trend of crypto in real estate transactions.
JULIE HYMAN: You may not be using crypto or Bitcoin to buy your pizza, but it is being used for a growing number of items like NFTs, for example. But what about luxury transactions or big ticket transactions, like real estate? This is something that Yahoo Finance’s Jennifer Schonberger looked into. And it does seem to be happening.
JENNIFER SCHONBERGER: Hi, hello, Julie. Yes, crypto is increasingly used for real estate transactions. In fact, the very first commercial real estate was put on the market in New York City for Bitcoin. Magnum Real Estate Group sells three commercial condos, with a fully rented ground floor on Manhattan’s Upper East Side for $ 29 million, but they only accept Bitcoin.
And while this is the first commercial property listing for Bitcoin, we’ve seen residential real estate transactions and crypto pick up in recent years. Bill Zielke, CMO of BitPay, a cryptocurrency payment processor who processes the real estate transaction for Magnum, said the payment processor has handled crypto real estate transactions for the past several years for international buyers, and more recently, in the United States for ski houses. in the western United States and properties in New York. Prior to listing its commercial properties, Magnum Real Estate completed three residential transactions for Bitcoin, including one on the Upper East Side for over $ 15 million in Bitcoin.
Ben Shaoul, the managing partner of Magnum Real Estate, says he expects crypto transactions to continue to grow.
BEN SHAOUL: I see the trail for crypto trading growing exponentially. The fact that Bitcoin is at all-time highs, you know, obviously helps. But I think investors are investors too and they’ve owned Bitcoin very, very well. And now they are looking for cash assets.
JENNIFER SCHONBERGER: And as the price of Bitcoin has continued to soar along with other cryptocurrencies, there is a correlation between these record highs and investor demand for real estate. So, as Shaoul mentioned, we should expect the crypto trading portion of the real estate market to continue to grow in the years to come. Julie?
JULIE HYMAN: But of course every time I hear about this stuff the price changes so much. Like, how do you decide how much Bitcoin is going to be traded? Like, when is – you know, what if you decide to buy that apartment in Bitcoin and the price goes up then? Like, how do they … I don’t know. How do you understand all this?
JENNIFER SCHONBERGER: Yeah, I mean, I guess that’s really fair – like you said, it depends on the price. But if you have accumulated enough fortune and you feel like withdrawing money and you want to deploy it in some other cash asset, be it an investment or, you know, where you actually want to live. then you are able to transfer that. And by the way, this is very interesting, because when you trade in Bitcoin or crypto, the settlement process gets faster and faster.
It’s only – it settles down the next day instead of taking 30-90 days to try and settle that transaction. So, I guess if you are in a rush or are an international buyer or investor, it also makes the checkout process easier.
JULIE HYMAN: May be. Okay, we’re going to be counting on you to keep us abreast of this trend, this emerging trend.