For months “Gustavo” invested all his capital in a cryptocurrency project he trusted. In Venezuela he started buying PancakeSwap (CAKE) when it cost less than 6 dollars. Eight weeks later, and already with a quotation of 36 dollars, he sold everything. The operations, although risky, left him an important profit that he decided to invest again, but this time in another area: the real estate market.
The Venezuelan trader had in mind to buy a house in Ciudad Bolivar, located some 600 kilometers southeast of Caracas. His intention was to offer his children a better quality of life. However, there was a problem. He had all his funds in the Binance exchange, in the stablecoin
Tether (USDT), and he didn’t know any real estate broker who accepted bitcoin or other cryptocurrencies as a form of payment.
Most of the real estate brokers he consulted operated through international bank accounts or cash currencies. He also heard of cases where they accepted transfers in bolivars, Venezuela’s national currency, although at a much lower rate due to hyperinflation.
The option of using banking services was ruled out by the user, who said that because of the amount of the transaction (about $12,000), his accounts were likely to be blocked. “There are many banking restrictions with amounts in bolivars, besides, it was going to waste a lot of time,” the merchant added.
In Ciudad Bolívar a house was paid for with USDT. The picture shows the buyer, seller and team of the real estate agency Edaca Global Group. Source: Courtesy Belman Andrés Abache.
“A friend told me there was a real estate agency that accepted cryptocurrencies as a means of payment. I found out and it was true. I contacted them to find out how the negotiation could be done. Once we were aware of everything, we used our Binance accounts to close the deal,” “Gustavo” explained to CryptoNews.
The trader ‘s case is similar to that of dozens of bitcoin (BTC) enthusiasts, cryptocurrency miners and even Axie Infinity players who are also investing in Venezuela’s battered real estate market. These are young people who decided not to emigrate and who would be taking profits in the current market to the
Transactions with bitcoin are kept private
This new reality of buying and selling homes with cryptocurrencies is known by the Venezuelan Real Estate Chamber. Its president, Francisco López, told CriptoNoticias that transactions with digital assets are appearing more and more. The problem, according to the executive, is that they are still not that common and those that are made are kept private.
“Right now we don’t have the capacity to determine how many transactions have been done with cryptocurrencies. They are usually private transactions that are not reported. I think it’s a world to be explored, a wave that has reached Venezuela. We see a lot of ads from real estate agencies that accept cryptocurrencies. That is another important issue, the training of brokers,” said Lopez.
One of the problems with transactions of this type in the country is that they do not appear in the Leasing Law or in the Law Against Real Estate Scams. That would be one of the reasons why bitcoin or stablecoins
transactions are kept private between the parties, the lack of legal protection that exists. Another point is the issue of security and the fact that national registries only accept sale and purchase documents denominated in bolivars.
A transaction with cryptocurrencies to buy a house is carried out in the following way: both parties agree and carry out the transaction in the offices of the real estate agency. The buyer transfers through Binance, for example, to the seller in USDT. The buyer then makes a second transaction to pay the real estate company its commission.
Another modality is that the buyer makes a reserve transaction as a commitment that he will execute the deal. This is a percentage of the cost of the house as a guarantee for the real estate company to start doing the paperwork. The difference in the amount is paid later at the closing of the deal.
In addition, the real estate company must be registered with the National Superintendence of Crypto-assets and Related Activities (Sunacrip) and report the transaction. The amount is stated in bolivars in the purchase and sale document, but it is for a much smaller amount. The agreement has been previously established in digital dollars or bitcoin.
There are also cases in which the parties agree directly, without the participation of real estate agencies. In these cases it is possible that the buyer hires a lawyer to draw up the corresponding papers.
From the Venezuelan real estate guild they are asking for the law to be modified to include operations in dollars, bitcoin
and other cryptocurrencies. In fact, the Venezuelan State, in theory, validates operations in petros (PTR), beyond those made with bolivars. However, here there would be another obstacle.
“The registrars, upon seeing that the sale and purchase documents are denominated in petros, do not accept them. They understand that the parties involved are using petros to receive dollars and assume that they can get into trouble, which is not true. That’s why it is important to modify the laws and technical training,” Lopez added.
<img src=”https://mk0criptonoticijjgfa.kinstacdn.com/wp-content/uploads/2021/08/registro-publico.jpg 998w, https://mk0criptonoticijjgfa.kinstacdn.com/wp-content/uploads/2021/08/registro-publico-300×169.jpg 300w, https://mk0criptonoticijjgfa.kinstacdn.com/wp-content/uploads/2021/08/registro-publico-768×432.jpg 768w, https://mk0criptonoticijjgfa.kinstacdn.com/wp-content/uploads/2021/08/registro-publico-560×315.jpg 560w, https://mk0criptonoticijjgfa.kinstacdn.com/wp-content/uploads/2021/08/registro-publico-750×422.jpg 750w” alt=” width=”-169″ height=”-94″ /> In Barcelona, Anzoátegui state, houses have also been sold with stablecoins. In the photo the staff of Inmobiliaria Grau together with the buyer. Source: Courtesy Inmobiliaria Grau.
President Nicolas Maduro himself has spoken out about the sale and purchase of houses in dollars and said that they were illegal. In November 2019, the president announced
that transactions for the purchase of homes, vehicles or motorcycles had legality if they were made in petros, not dollars or other cryptocurrencies. This decree clashes with what actually happens in the registers.
Axie Infinity profits to buy houses
One of the reasons that is incentivizing the sale and purchase of homes with cryptocurrencies in Venezuela is Axie Infinity. The non-fungible token (NFT)
based game has transformed into the main source of income for dozens of people in the South American country. With the rise of the market, players have amassed capital that they are now looking to diversify into real estate.
According to Carlos Grau, operations manager of Grau Real Estate, located in the state of Anzoátegui, in recent months he has received calls from all over the country from Axie Infinity players. People have contacted him because the company accepts payments with cryptocurrencies and they want information on how to buy houses with the profits they have earned.
“We’ve had quite a few customers come to us. Many of them are Axie Infinity players looking for houses or apartments. Most of them manage budgets ranging from $7,000 to $12,000 in USDT. There are also traders
or miners who have shown interest in investing,” Grau said.
The real estate broker noted that, although the demand for the purchase of housing with cryptocurrencies has risen, it has not done so in the same proportion the available supply. In the case of buyers are young enthusiasts of the digital world, while on the side of the sellers are people who are not closely related to technology and are usually older.
Real estate agencies in Venezuela are beginning to accept cryptocoins as a form of payment. Source: Edaca Global Group.
Cryptocurrencies as a source of income
Due to the economic crisis that Venezuela is experiencing, thousands of people have approached bitcoin and other cryptocurrencies as an alternative for the safeguard of value. Currently this relationship has been magnified with people not only exchanging their bolivars for BTC, for example, but there is also a sector of the population that earns its salary in digital assets.
For the lawyer and real estate consultant Belman Andrés Abache, from the Edaca Global Group, some people are investing in Venezuela because they have cryptocurrencies as a source of income. The broker explained that traders
, miners, Axie Infinity players or people who earn in BTC, liquidate profits in different ways.
“Many do not have bank accounts abroad and prefer to leave their funds in exchanges rather than exchange them into bolivars. Others are exchanging to dollars in cash, but most prefer to make transactions directly in USDT from Binance for whatever they want to buy, be it houses or vehicles, for example,” the advisor noted.
One such case was recently reported by CryptoNews when a young trader paid $12,000 for a house in Barcelona, a city located about 350 kilometers east of Caracas. The bitcoin trader used the stablecoin
Tether to acquire the property, which he then gave to his mother.
Venezuela is one of the countries with the highest adoption of cryptocurrencies in the world. The fact that Venezuelans are using digital assets to buy houses reflects the reach of the bitcoin ecosystem and the entire industry that moves around it.