The world of cryptocurrency is still, well…cryptic at best. There is a lot many people don’t know about it, and as the saying goes, people tend to fear what they don’t understand. But let’s remember back to a time not so long ago where the internet wasn’t as readily received and trusted as so many assume it was. Now, people shop online, bank online, and you’re even reading this via that platform. The truth is, integration takes time.
But is blockchain on par to invade every industry as the “normal” internet did? Also, what even is blockchain and cryptocurrency? Let’s take a look at what they are, their possible importance, and what they may mean for so many in the real estate industry.
What is Blockchain?
In its simplest explanation, the blockchain is a series of thousands to potentially millions of computers that each keep a record of a specific transaction that is open for the general public to view. In other words, it’s akin to the world’s largest third-party verifier of an agreement between two parties. Each ledger is encrypted into the system, and it is virtually hack-proof. Since all of these computers witness the same agreement, they can all offer proof and a consensus that a contract is valid. One of the main benefits that blockchain posits is the elimination of the middleman in financial agreements.
What is Bitcoin?
Bitcoin is simply an application of the blockchain. For instance, when someone purchases a bitcoin from a seller, they are paying with cash. This exchange is witnessed by thousands of computers, and thus the financial agreement is considered valid. This process can then be repeated down the line, with people paying cash for bitcoins and then selling them for more…well, cash.
Blockchain and Real Estate
Believe it or not, it may be in our future to enable people to purchase a home by clicking on a digital icon of a shopping cart. How? The blockchain would allow the buyer access to the title and deed and the seller to cash (via cryptocurrency). Again, this would eliminate the third-party necessity that comes by way of attorneys and title companies in the buying/selling process.
Indeed, there is a lot to determine when it comes to cryptocurrencies experiencing full integration into the real estate market. But with ReTech sector continuing to grow in popularity, it is certainly not something to ignore and rule out, especially if you have an interest in the real estate industry.