Buying with Bitcoin
A homeowner in Melbourne recently made headlines for saying he's willing to accept Bitcoin as part of the payment for selling his property. It's very exciting for a lot of people, especially as cryptocurrencies become more mainstream and more accepted. But is this really the way of the future? Let's find out.
Bitcoin is currently the most popular form of cryptocurrency on the planet. A cryptocurrency is essentially a digital form of money, but unlike any other currency, it's not governed by any central authority.
There's no Bitcoin Bank, or Bitcoin Institute setting the value of bitcoin; instead, an online program keeps track of every transaction, and this program can be run by basically anyone with a computer. There's a lot more to it, but essentially, it's a way to crowdsource an economy.
Can Bitcoin Buy Stuff?
Simply put, yes. At the time of writing, 1 Bitcoin is worth roughly $19,000 Australian dollars, so clearly this can be very lucrative. The problem is finding someone who's willing to trade their money for your bitcoins. There are some companies set up to make exchanges, but there's currently little regulation in place.
Also, as it's a new currency, its value can vary wildly from day to day, so it's entirely possible for your bitcoins to be worth half as much tomorrow, or double in price in a month.
Can I Sell My House For Bitcoin?
In theory, yes, but for now it's better to stick with dollars and cents. The problem with bitcoin is that it's just too volatile. Say you paid $600,000 worth of bitcoin for a house on Monday; by Tuesday that same bitcoin could be worth $300,000, or $900,000, or any number whatsoever. This creates a major problem for seller and buyer alike, especially as even an easy sale naturally takes a few weeks to get sorted.
Bitcoin is very interesting, and is definitely here to stay, but you don't want to trust what could be the biggest sale of your life to such an unpredictable currency. We're always looking at the cutting edge of real estate, so if you have any questions about real estate, feel free to get in touch for our expert opinion.
Griepink, E., 2017, Melburnian Home Owner on Course for Aussie First with Part Sale of House in Bitcoin
Miller, D., 2017, Bitcoin Explained: The Digital Currency Making Millionaires
Neary, T., 2017, Bitcoin Set to Make Real Estate History, But Are We Ready Yet?