The blockchain technology revolution and the rise of cryptocurrencies have opened new perspectives in many sectors, including real estate. In this context, Dubai, an emerging financial and technology center, has been one of the first to allow the purchase of real estate using cryptocurrencies. This article will explore this emerging trend and its implications for the Dubai real estate market.
Blockchain and cryptocurrency revolutionize the real estate sector
Blockchain is a decentralized technology that allows to record your transactions in total security. Cryptocurrencies are digital assets based on this technology, which are used as a means of exchange. When applied to real estate, these tools offer many benefits, such as reducing transaction costs, eliminating intermediaries and ensuring transparency.
Buying cryptocurrency has not yet been fully formalized, but this is possible by passing through the intermediary of a financial institution or by concluding a direct agreement between two individuals.
Dubai: A pioneer in buying real estate in cryptocurrency
With the announcement of a new dedicated regulator, the creation of their own crypto-coin and the the organization of several events related to the cryptocurrency world, Dubai has established itself as a true pioneer in the acceptance of cryptocurrencies. In 2017, the Dubai government launched the "Dubai Blockchain Strategy", aiming to make Dubai the first city in the world to run entirely on blockchain in the coming years. This initiative encourages the use of blockchain and cryptocurrencies in different sectors, including real estate.
Many real estate developers have also seized this opportunity by allowing the purchase of real estate in cryptocurrency. For example, the "Aston Plaza & Residences" was one of the first real estate projects allowing buyers to use cryptocurrencies, including Bitcoin, to buy real estate.
How to buy real estate in cryptocurrency ?
Cryptocurrencies as a guarantee
When a building is purchased on credit and you should make a deposit, it can take the form of cryptocurrencies. Crypto lenders, such as BlockFi, Celsius and Unchained Capital, offer products with annual percentage rates ranging from 1% to 6%.
Direct transfer of cryptocurrency from buyer to seller
In business practice, the contract becomes the law that governs the parties interactions. Nothing prohibits two people from concluding an agreement that allows the purchase of a property in cryptocurrency.
However, in order to preserve your rights and obligations, it is advisable to be accompanied by a lawyer for the drafting of your contract.
Advantages of buying real estate in Dubai in cryptocurrency
1. Rapidity and efficiency of transactions: traditional real estate transactions can take time due to the complexity of legal and financial processes. The use of cryptocurrencies simplifies this process, with instant and transparent funds transfers.
2. Cost reduction: traditional real estate transactions often involve high fees, such as brokerage fees and legal fees. Buying in cryptocurrency reduces these costs by eliminating intermediaries.
3. Increased security: blockchain provides enhanced security through the use of smart contracts that automate and execute transaction conditions. These contracts provide protection against fraud and allow the parties to conclude agreements in a secure manner.
4. Zero tax on cryptocurrencies: compared to other countries where a tax is levied on the capital gains related to the variation of the cryptocurrency values, in Dubai this is not the case.
Summary
Dubai takes a leading position in the field of buying real estate in cryptocurrency. This trend opens up new opportunities for real estate buyers and sellers, offering benefits such as faster transactions, lower costs and increased security. However, it is important to remain aware of potential risks and consult professionals for a thorough understanding of these transactions. With its commitment to blockchain technology, Dubai offers great opportunities for buying real estate in cryptocurrency, which contributes to the evolution of the real estate market of this dynamic city.
