Revolutionizing the home buying process, Propy introduces crypto-backed loans, allowing buyers to use their digital assets as collateral for tokenized properties.
Real Estate Firm Propy Revolutionizes Home Buying with Crypto-Backed Loans
Propy, a leading real estate firm, is set to disrupt the traditional home buying process by introducing crypto-backed loans. This innovative approach allows bitcoin and ether holders to use their digital assets as collateral to acquire tokenized properties.
The concept is simple: prospective buyers can take out a loan from Propy to purchase a property, with the option of paying back the loan using their cryptocurrency gains. The loan comes with a 10% yearly interest rate and a two-year repayment period. If the value of the cryptocurrency used as collateral drops by more than 50%, the buyer may face a margin call, and in extreme cases, their crypto holdings could be liquidated.
However, if the cryptocurrency doubles in price, the buyer can simply repay the loan using their gains. The interest payments and loan itself can be paid back in bitcoin, ether, or USDC. This flexibility makes it an attractive option for those looking to invest in real estate without having to exit their cryptocurrency holdings.
Tokenization: A Game-Changer in Real Estate Transactions
Propy’s tokenization process involves setting up a limited liability company (LLC) for the property and creating a digital token that represents ownership. This process takes approximately two weeks and enables instant, efficient transactions. Upon acquisition, the LLC is amended to reflect the change of ownership, and the property’s token is transferred to its new owner.
The firm has already successfully tokenized properties in the past, including a 17th-century Italian mansion auctioned on the blockchain in 2017. Propy’s CEO, Natalia Karayaneva, believes that this technology will simplify home buying by replacing the traditional lengthy loan approval process with an instant solution.
A Glimpse into the Future of Real Estate
Karayaneva envisions a future where real estate transactions are conducted on-chain, making it easier for buyers and sellers to conduct business. With Propy’s crypto-backed loans, property owners can now use their digital assets as collateral to acquire tokenized properties.
The potential impact is staggering: if the $300 trillion real estate market becomes liquid, it could revolutionize the way people invest in and own properties. As Karayaneva notes, “Imagine making an on-chain swap between a real estate on-chain asset and bitcoin asset, or another crypto asset.” This vision of a decentralized, blockchain-based real estate market is exciting and promising.
A Partnership to Support Crypto-Native Deals
Propy has partnered with Coinbase to provide escrow services, supporting the crypto community in making real estate purchases. This collaboration enables buyers to avoid wrapping their holdings in ERC-20 tokens like wBTC, making it easier for them to invest in properties using their cryptocurrency assets.
Once a property is tokenized, nothing prevents the buyer from selling it to another crypto-native without going through Propy. The token can be sent to a new wallet, and the buyer will automatically receive a link to provide Know-Your-Customer (KYC) information. This process allows buyers to “un-chain” their properties and own them in the traditional way.
Propy’s goal is to on-chain as many real estate assets as possible, making it easier for people to invest in and own properties using cryptocurrency. With its innovative approach to crypto-backed loans and tokenization, Propy is paving the way for a decentralized, blockchain-based real estate market.
