Blockchain Is Now Legal Tender In El Salvador. Real Estate Investors, Take Note.

Image representing the idea of a blockchain.

June, 2021 — As readers know, we’ve been watching the steady emergence of blockchain for real estate applications. Blockchain, which was introduced to the world through Bitcoin in 2009, is here to stay. How can we say so? It’s increasingly viewed as a change agent in the way business is done.

Case in Point: El Salvador, June 2021

Cryptocurrency has just reached a new milestone, becoming a legal tender in El Salvador. To underscore the intent to make bitcoins more like a currency than a taxable asset, President Nayib Bukele said transactions could occur without being subject to capital gains tax. On the 9th of June, 2021, the president tweeted about the country’s official recognition of Bitcoin:

The #BitcoinLaw has been approved by a supermajority in the Salvadoran Congress. 62 out of 84 votes! History! #Btc

Bukele has replied to concerns that cryptoassets can be used by criminals, observing that criminals trade in U.S. dollars and other assets as well. The president also tweeted a rebuttal to the objection that cryptocurrency relies on coal-based electricity:

I’ve just instructed the president of LaGeo (our state-owned geothermal electric company), to put up a plan to offer facilities for #Bitcoin mining with very cheap, 100% clean, 100% renewable, 0 emissions energy from our volcanos. This is going to evolve fast!

El Salvador will offer citizenship to those who have invested in at least three bitcoins.

Note: Bitcoin with a capital B is usually reserved to mean the platform, whereas a bitcoin with a small b is the cryptoasset itself. BTC is the abbreviation for bitcoin traded on an exchange.

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Deeds, Reimagined: Is a New Day Dawning for the Chain of Title?

Image of a very large steel chain with the sun shining through one of the links. Captioned: Is a New Day Dawning for the Chain of Title?

Art met real estate in a new way this year. Krista Kim’s Mars House design appeared on the first irreplaceable, non-fungible token (NFT) for a virtual house and garden. Kim’s virtual experience was followed by an NFT listing for a home in New York (a real one) on the Ethereum blockchain.

Think it’s all a flash in the pan? Look again. Blockchain’s tamper-resistant ledger system offers tremendous benefits for real estate deeds. It’s poised to transform the way we trace a chain of title. And the rise of NFTs just shows how fast things are moving.

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The Real Estate Deal, Decluttered: Blockchain and Deed Recording

Throughout the past decade, blockchain technology has evolved from an upstart concept to early adoption in banking and a host of other industries. Many people are eager to learn about blockchain and how it can change the way we do business.

What, we might wonder, can the blockchain do to remedy the hurdles and risks that pervade the real estate industry?

The question is now ripe. Today, we can review early examples of blockchain technology in action, modernizing property conveyance. Specifically, blockchain applied to real estate has obvious potential for improving the deed recording process.

How will blockchain make things better?

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