You may need to pay extra if you want to buy a home with Bitcoin

By Chuong Nguyen April 12, 2018

bitcoin in hand — NurPhoto/Getty Images

With the surge in popularity of cryptocurrency, it’s becoming more acceptable to pay for things with Bitcoin. However, given the volatility of cryptocurrency exchanges, accepting Bitcoin can result in a loss for the seller if the market takes a downturn. One enterprising individual is hoping to cover any possible losses, and likely secure a gain, demanding a premium for accepting Bitcoin.

Hedge fund manager Claio Guazzoni de Zanett is selling his Manhattan townhouse, and potential buyers can pay the $30 million listing price in cash, with a mortgage loan through a bank, or use cryptocurrency to fund the transaction. If you use cryptocurrency, though you’ll have to pay $45 million. That’s a whopping 50 percent premium over the traditional list price.

Recommended Videos

No foreigner to cryptocurrency exchanges, Zanett is the founder of the Zanett Cryptocurrency Group and has been an investor in cryptocurrency and blockchain since at least 2015, according to CCN. “I’m a true believer in these networks, but it’s very volatile,” Zanett said of cryptocurrency exchanges in an interview with the Wall Street Journal. “They could be down 60 percent in two weeks.”

Zanett says he will accept Bitcoin (BTC), ethereum (ETH), or Ripple (XRP) for the transaction. The townhouse is listed as a six-story property in New York City’s Upper East Side neighborhood.

While Zanett asking for a 50-percent premium from buyers wishing to pay with cryptocurrency, he wouldn’t be the first to accept Bitcoin as a form of payment for real estate. One buyer in Colorado purchased a home for Bitcoin, but in a hybrid transaction scheme. In that purchase, the buyer slowly liquidated his cryptocurrency portfolio, converting his holdings into cash, which he used for the purchase.

Cryptocurrency investors could of course work their way around Zanett’s premium by selling their cryptocurrency holdings and converting their investment into cash. The cash can then be used to finance the purchase of the $30 million property, rather than transferring the cryptocurrency funds directly to Zanett.

As cryptocurrency gains momentum, it’s unclear if other real estate sellers or vendors would demand such a hefty premium when Bitcoin or similar funds are used in a transaction. In addition to Zanett’s listing, there are five cities around the world where you can use Bitcoin to pay for real estate, including Miami, Dubai, New York, Lake Tahoe, Nevada and Bali, according to Coin Telegraph.

If you’re looking for a house to buy, be sure to check out some of the best real estate apps available on mobile.

Topics

Former Digital Trends Contributor

Silicon Valley-based technology reporter and Giants baseball fan who splits his time between Northern California and Southern…

Computing

Ethereum vs. Bitcoin: What’s the difference?

ethereum vs bitcoin bitcoinethereum01

Cryptocurrencies can be a little confusing. Are they digital money or more like gold? Are they a new way to pay for things online or a way to store value? Those aren't easy questions to answer when you're talking about hundreds of different cryptocurrencies, some old, some new, and some very different from the rest. When you focus Ethereum versus Bitcoin, though, there are some stark, apparent differences.

Their age is the most obvious, with Bitcoin having entered this world as the very first global cryptocurrency in 2009 and Ethereum only showing up in 2015 as a potential alternative. Although it is less proven than its predecessor, Ethereum does have a few nifty features that give it a lot more potential than its older sibling in some key areas. For this guide, we'll look at two shared aspects of the cryptocurrencies: Their ability to act as a store of value and as transactional mediums. We'll also take a look at some of the unique features which make them stand apart.

Computing

Facebook Libra vs. Bitcoin

Facebook Libra fake physical token

There are a lot of cryptocurrencies out there, but it surprised a lot of people when Facebook made headlines by announcing its own. Libra has been available to purchase since 2019, but many people still aren’t sure whether they should take the plunge and buy a few shares.

Luckily, we’ve gone ahead and done a lot of the research for you. Read more about how Libra compares to a popular currency like Bitcoin.
Availability and history
Bitcoin's white paper was originally released in 2008, with the first Bitcoin being mined in 2009. Today you can buy, sell, and trade Bitcoin on a variety of different exchanges and with millions of individuals privately, all over the world.

Computing

What is Bitcoin mining?

what is bitcoin mining

Bitcoin mining is far removed from the average Bitcoin owner these days, but that doesn't change how important it is. It's the process that helps the cryptocurrency function as intended and what continues to introduce new Bitcoins to digital wallets all over the world.

Collecting cryptocurrency can be boiled down to a simple premise: "Miners," as they are known, purchase powerful computing chips designed for the process and use them to run specifically crafted software day and night. That software forces the system to complete complicated calculations -- imagine them digging through layers of digital rock. If all goes to plan, the miners are rewarded with some Bitcoin at the end of their toils.
Why do we need mining?
Bitcoin works differently from traditional currencies. Where dollars, pounds, and euros, for instance, are handled by banks and financial institutions that collectively confirm when transactions occur, Bitcoin operates on the basis of a public ledger system. In order for transactions to be confirmed -- to avoid the same Bitcoin from being spent twice, for example -- a number of Bitcoin nodes, operated by miners around the world, need to give it their seal of approval.