In a sign of their increasing popularity, bitcoin (BTC) and other cryptocurrencies are being used to buy real estate. The Crypto Realty Group has been brokering multimillion-dollar cryptocurrency home purchases in Southern California for years. ThirtyK spoke to CEO and co-founder Piper Moretti about cryptocurrency deals and how blockchain will change the way you buy a home.
ThirtyK: How long have you been involved in real estate?
Moretti: For a total of three and a half years. I have an entertainment background and took up real estate to fill in the gaps between shows. I was in sitcoms for a long time and they are kind of like school years, going from August to April, and I got so busy [with real estate] that I thought I [had] to make a choice. Then my show got cancelled and I took it as a sign.
ThirtyK: Were you into cryptocurrency before real estate?
Moretti: I heard about it back in 2009 and completely forgot about it. I didn’t really think about it again until my clients started asking about it in 2016. The first deal was for purchasing a $3 million house. I’ve never considered myself a techie, but I was always interested in it and am a quick learner.
“We will still be doing traditional transactions,” says Moretti, “but I can see doing a lot more crypto, and the startups I’m working with won’t be startups anymore.”
ThirtyK: So you only did traditional real estate transactions until your clients showed interest in cryptocurrency?
Moretti: Exactly. I started in October 2014 working with a company as I learned the ropes and got my license. I passed [the licensing exam] in April 2015 and was doing real estate for about a year and a half before my first cryptocurrency clients found me. They were in the Southern California area, wanted to check out new places and found me online through Realtor.com. They were from the East Coast and decided to settle down here in the South Bay.
We found a house they appreciated in Manhattan Beach and, out of the blue, they said, “We’re going to buy it with bitcoin.” I started calling people, leaders in the industry I know, asking, “Have you done this before?” The best advice I got was from my lender who said, “Let’s just [have the buyers’] transfer this to cash [and then do a cash transaction],” but that wasn’t the option we wanted.
I did find a transaction that happened in [the Lake Tahoe area] two years prior to ours, and they used BitPay for the transaction. I also connected with the International Blockchain Real Estate Association, as well as a contact in Philadelphia who knows all about getting titles with blockchain. We put the puzzle pieces together. From escrow, we closed in 30 days. [Using BitPay, Moretti and her team had the clients’ bitcoin transferred to the seller as cash.]
ThirtyK: Thirty days? That’s fast for even a traditional real estate transaction. Is that reflective of the faster pace tech-focused people want, or another factor?
Moretti: The tech world moves very fast and [buyers] expect immediate gratification, so they are used to the transactions being seamless. We’ve done five crypto-based purchases and had an escrow in as short as eight days.
ThirtyK: What currencies do you work with now?
Moretti: Bitpay only handles certain currencies, and we transfer that to bitcoin and then transfer that to cash.
ThirtyK: When will crypto’s acceptance start to become more mainstream?
Moretti: It’s already starting to change. Go to Realtor.com and some home sellers are up to accept crypto. On the lender side, brokerages are starting to toy with blockchain. One startup is looking at a payment gateway to create a end-to-end transaction process, but it’s a lot of state-to-state regulation to comply. Some startups are just in a hurry to get transactions done, but they are opening themselves up to a lot of lawsuits. I work with another startup that funds loans in 48 hours, all on the blockchain.
ThirtyK: You are focused on high-value, multi-million dollar properties in Beverly Hills and elsewhere. Are you finding more cryptocurrency interest from higher-end clients or more resistance because the amounts are bigger?
Moretti: Everybody is different. My clients so far, they’ve had a ton of crypto, and they were fine with the extra fees, but I’ve had other people that don’t have as much and want to do a down payment in crypto and the rest in cash. As far as banks, the smaller ones are more willing to include crypto in the pre-qualification process.
You’ve also got foreign buyers who have a ton of cryptocurrency here in Southern California, like the Chinese and the Saudi Arabians. I get the full gamut, but more towards people who have it and need to put it somewhere so they can cash out if they need to.
ThirtyK: Have you thought about issuing your own token?
Moretti: No! With all the [initial coin offerings], I’m almost afraid to, and I feel like the bubble is coming. It’s a great idea, but beyond me at this point.
ThirtyK: Do other realtors think your approach is genius, crazy or something in between?
Moretti: The older generation often says, “That’s nice,” as they’ve made their millions from traditional real estate and look at [crypto] as a fad. The ones that know that change is coming are fascinated and want to learn more. On the other side, the younger generations are sometimes claiming they are the crypto people, saying, “Come to us, we’re hip!” But buying a few coin vaults doesn’t make you an expert.
ThirtyK: Let’s talking about Spring 2023. Where will we be?
Moretti: Speaking for California, it’s currently entertaining blockchain as a legal form of record so things can be easily regulated and easy to put into documentation. I was recently sending a contract to a lender, and I had to email him over and over again because his server kept rejecting the size of the document. I was thinking, “This shouldn’t be happening in 2018!”
We will still be doing traditional transactions, but I can see doing a lot more crypto, and the startups I’m working with won’t be startups anymore. Rather than doing a couple transactions, we could be doing hundreds at a time. It won’t be about making 20 phone calls to get work done.