Cryptocurrency, The Blockchain and Lenders – Yes, It’s a Thing.
“The times, they are a changin’”, as a mid-century poet once stated (yeah, it was Dillon but roll with it). Since Bitcoin and cryptocurrency hit the mainstream craze, some traditional lenders are beginning to entertain the idea of including crypto holdings as assets when prequalifying clients, as well as working out hybrids such as a crypto down payment and financing the rest of the loan in fiat. The seller doesn’t necessarily need to accept the crypto down payment unless they choose to do so, but as we know a crypto to fiat conversion is just as easy.
To add, in today's market the Hodlers are Holding like never before, which makes crypto-lending more appealing than ever. Many crypto lenders have come and gone, but as Realtors in the new age of crypto, we should all add these to our knowledge base and continually research the new platforms that are being introduced, and by all means, please email me the ones you think we should keep an eye on.
If you’re a savvy crypto investor (or a beginner as well), chances are you’ve heard of Celsius. Celsius holds blockchain investments as collateral for cash lending. A borrower sends the collateral to the Celsius collateral wallet and fiat funds are then transferred to the borrower’s bank account. They maintain portions of the collateral both in hot and cold storage, where it remains the property of the borrower, and any depreciation or appreciation still belonging to the borrower. Once the loan payments are completed, the collateral is returned. KYC is always a thing so don't think you'll be able to get far without it. Dividends are paid out if your crypto surges and can be used to pay off the loan. Rates are varied due to market conditions, but my guess is they’ll tack on a little more due to the specialty, which I’m almost positive any crypto borrower won’t mind.
I’m sure there are many other similar platforms looking to add value to the lending side, as the lending process as we all know it is archaic, time consuming and expensive. As the blockchain-powered real estate platforms grow and secure their footings, I see them partnering with lenders like these for faster, cheaper, transparent and verifiable end-to-end transactions that can be completed in a matter of just days rather than the average 30-60-day escrows. Get ready to see a massive shift in the next two to five years.