Real estate transactions have changed drastically with the emergence of cryptocurrencies and blockchain technology in recent years. Despite the growing popularity of these technologies, though, few people realize the differences between blockchain technology vs cryptocurrency, or what they offer to buyers or sellers. Let’s compare the two technologies and how they work within real estate.
Blockchain technology is a shared, fixed ledger of transactions across a network of users. All transactions are encrypted and stored using information shared between the current and prior transaction and put into a “box” or “block,” which are “linked” or “chained” together using the borrowed information. Due to blockchain’s structure, information is extremely secure as hacking requires changing codes for thousands of blocks.
With a direct exchange between buyers and sellers, blockchain technology also cuts the expense and paperwork of using third parties for quick, simple transactions.
Cryptocurrency is digital currency secured through a blockchain to track transactions between users. Using this network, cryptocurrency is secured in a digital “wallet” that tracks virtual earnings, transfers, and spending while also preventing copies.
Using numbers rather than metal or cotton, cryptocurrencies can be quickly and directly transferred across multiple exchanges unlike traditional currencies; likewise, their digital form makes crypto more durable, portable, and divisible than any other currency.
Ultimately, cryptocurrency’s market value relies upon the supply and demand of people accepting it as payment. Considering the fact that there are over 20,000 cryptocurrencies on the market, it does appear to be an emerging payment method of the digital era.
Cryptocurrencies like Bitcoin have grown in popularity in recent years.
Find Home Comfort with Millennial Title Smart Contracts
It’s not uncommon for people to equate blockchain and cryptocurrencies—believing they are synonymous. While crypto is the trademark application for blockchain, the technology is finding a home in many other uses. Through a process called tokenization, blockchain allows you to turn an asset like your house into a digital token that can be traded like cryptocurrency, which minimizes liability by allowing users to turn their real estate assets into tokens they can trade over time.
With tokenization, buyers and sellers can easily trade their assets while eliminating the expense and time wasted by third-party intermediaries. However, this digital exchange also requires a legal contract to ensure the negotiated terms of both parties are met. That’s where Millennial Blockchain’s smart contracts come in.
Millennial Blockchain is a division of Millennial Title offering cryptocurrency closings throughout the United States. By utilizing the digital transparency of smart contracts our customers can digitally exchange cryptocurrency for real estate transactions using blockchain technology. Built on the same design as blockchain, smart contracts allow crypto users to trade their money, properties, shares, or other assets automatically into each other’s accounts. Additionally, smart contracts set the rules and penalties negotiated between buyer and seller, but once reached terms cannot be altered due to its automated structure. For example, person A can’t receive property assets until person B confirms their cryptocurrency deposit.
With Millennial Title, customers can gather important real estate documents in smart contracts, using blockchain technology to collect everything into a simple, accessible source. As cryptocurrency and blockchain continue to evolve, our experienced team members look to support clients in closing their home sales. To learn more about cryptocurrency or our smart contract solutions, contact us at Millennial Title today!