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For many people, crypto is synonymous with cryptic. However, in the luxury real estate industry, the wealthy clients we work with often want to know more about cryptocurrency coins, exchanges and markets, and the opportunities and risks they pose. At the same time, blockchain-based technology continues to proliferate and evolve, potentially changing the way luxury real estate is bought and sold in the future.
Personally, I know cryptocurrencies well — the concept appealed to me immediately. I was inspired to make my first investment in his 2017 and is now the owner of a cryptocurrency mining company. Since then, I have personally made hundreds of transactions including payments for goods, services, NFTs, and investments in over 100 cryptocurrency projects.
This space can be a roller coaster ride with soaring highs, plunging lows and sharp changes. As such, clients will inevitably ask questions about cryptocurrencies and it is important that we, as agents and trusted advisors, are able to share factual and accurate insights with them.
The Prospects of Cryptocurrencies in the Luxury Real Estate Industry
As you’ve probably heard, the cryptocurrency pendulum is currently swinging, and people are reacting differently to that volatility. Overall, the main sentiment of the individuals I spoke with was curiosity, with many wanting more information about what cryptocurrencies are and what purposes they serve.
Most are optimistic about the sentiment among investors and colleagues in the crypto space. It may surprise you, but the reality is that there has been a lot of speculation in the market and a correction was inevitable before returning to a more stable and profitable state.
And while blockchain technology in luxury real estate is still in its infancy, we are already witnessing the emergence of exciting new trends, such as selling luxury real estate as NFTs.
Once an NFT is created, you can use a smart contract to declare that you have built your own property in an exceptional location and cite it as its creator. After that, no matter how many times the owner changes, he will receive 1% of the proceeds for each sale. This is a huge win for investors and developers building iconic properties, and it’s just scratching the surface of what’s possible.
So when a client comes to you for perspective on cryptocurrencies, what can you share with them to provide a strong foundation for further research and investigation?
Tip #1: Beginners Can Get Familiar with Bitcoin
We recommend starting with the most proven and trusted cryptocurrencies. With a limited supply of 21 million, Bitcoin is the closest thing to digital gold. My advice to my clients is to start their crypto education with Bitcoin as a way to ease their entry into this field.
Tip #2: Help Your Clients Learn About the Ethereum Blockchain
Another famous name for crypto that clients know is Ethereum, the platform on which most Web3 technologies are built. It provides the base layer on which about 90% of new crypto projects, including NFTs, are built and run.
Tip #3: Crypto Investors Need to See the Big Picture
When people become fearful or skeptical of cryptocurrency value volatility, I want to remind them that it is important to look at the long-term growth potential. I strongly encourage anyone to have a 10-year outlook. Investors should designate a portion of the funds that they do not need in the immediate future and commit to not touching these initial investments for at least 10 years.
Tip for buyers: Always cash out before the sale
Luxury home buyers looking to invest in cryptocurrency should know two things. First, like any payment method, a purchase creates a taxable event. Secondly, due to market trends and daily fluctuations, cashing out prior to purchase can be beneficial. Buying and selling cryptocurrencies is very similar to trading stocks.
Advice for Sellers: Only Allow Commonly Traded Currencies
The same advice applies if a seller is looking to accept cryptocurrencies as home payment. We recommend using only respected currencies, especially Bitcoin. And we plan to hold onto that Bitcoin for at least 5 years to maximize future returns.
Summary: Play the Long Game, Play Smart
Two things are important here. The first is that clients currently considering cryptocurrencies, whether for investment or trading, should only focus on Bitcoin.Currently, most other currencies are too volatile. is unstable.
Second, if the investment is sustained over the long term, the chances of creating and sustaining generational wealth are greatly enhanced. In the long term, cryptocurrencies may offer greater wealth preservation and growth than real estate.
Born and raised in the Pacific Northwest, Brian’s knowledge of the Seattle metropolitan area and the East Side is invaluable to his clients. He calmly navigates all enclaves, educates clients at every stage of the deal, and even provides insight into the best restaurants, shops, and parks in each community. Brian Hawkins leads the industry with integrity, discipline and integrity. Working with Cyrus O’Bryant, Brian formed his team at the top of his Realics Sotheby’s International Realty, with over 330 deals and his staggering $154 million total turnover. .