FEBRUARY 20, 2022 | Issue 03
I FEEL CONFLICTED. I NEED YOUR HELP.
I've been fascinated with crypto since last March and I can't get enough of the topic. So many pieces of it interest me – NFTs, smart contracts, bitcoin's inevitable impact on global finance, blockchain, the metaverse, and a lot more. Distilling the most relevant parts of this new world into a short, easily understood weekly newsletter for real estate agents helps me learn. And I'm having fun.
However, I struggle with how deep I should dive into a topic. I assume that as long as I keep my writing clear and the subjects interesting, you'll read the entire newsletter.
If you do this weekly, you will become a crypto-savvy agent.
As crypto starts infiltrating our daily lives, just has social media has done, you'll become the leading crypto agent in your market – setting you apart from the pack.
This is my vision.
However, I need a reality check. Please send me an email and tell if you read the entire newsletter or just skim it.
Also, to those of you who have reached out to me, thank you!
It's been great emailing, texting, speaking, and having video calls with agents, tech folks, and managers about the newsletter.
Please tell others about Crypto News for Realtors. I'd love to add them to the email list. Send their full name and email to email@example.com.
Enjoy the newsletter, have a great week, and stay crypto curious!
PS. You can find all CNR newsletters here.
CRYPTO REAL ESTATE NEWS
NFT Tampa House Listing Agent Answers Questions
Amy Heckler, the listing agent for the NFT Tampa house answered questions on Facebook Live. (Link to watch the February 18, 2022 session.)
Heckler said that setting up the NFT (non-fungible token) auction required many calls with attorneys, title companies, and auction houses.
The seller flips houses and has worked with Heckler for years.
The seller owns a company that sells NFTs and was interested in selling her house as an NFT. It would help her business and brand. The seller engaged Propy to assist with the NFT auction.
The sale was structured so buyers could either submit offers through their agent or bid for the house in an NFT auction. Offers submitted by agents would not be accepted before the NFT auction.
The winner of the NFT auction would acquire ownership and control of a corporation that included the house as an asset. Here's how it played out.
There was a lot of interest in the property and the open house was packed. Heckler received "many offers" well above list price. The auction was held and two bids were submitted. Since the bids were above the reserve price, the seller was required to accept the highest bid. Heckler said the agent-submitted offers were higher than the winning NFT bid.
Heckler discussed other issues that arose during the transaction: ▸ All NFT interested bidders needed to show proof-of-funds (adequate cryptocurrency) before receiving details of the NFT. Essentially, all auction bidders were "cash buyers." ▸ The house didn't have a mortgage or any liens. If it had, it could not have been sold as an NFT. ▸ The seller paid the listing broker's commission after the auction. ▸ Florida real estate law requires payment of a transfer tax that is typically paid in escrow. Since there was no escrow, the seller paid the transfer tax after the auction. ▸ The seller conducted a title search. However, no Florida title insurance company would issue a policy. Heckler and the seller worked through all the issues and accomplished their goal of being the first house sold as an NFT in the U.S. NFT purchases for real property is in its infancy. Agents and sellers working on the next NFT transaction will learn from this one. Instead of merely watching NFTs evolve, be a pioneer in your market and consider offering an NFT with your next listing.
▸ JPMorgan, the largest bank in the U.S., opened up a lounge in the virtual world, Decentraland. (If you want to get a glimpse of the future, allocate at least 30 minutes and visit Decentraland. It is very trippy!)
Their announcement coincided with the release of a report, Opportunities in the Metaverse.
The report covers how virtual world technology has evolved and where it may be going. It discusses the economic opportunities, including virtual real estate.
Parcels of virtual land doubled in price in six months in 2021. It increased from $6,000 to $12,000 across the four main metaverses (Decentraland, The Sandbox, Sominum Space, and Cryptovoxels).
The appreciation has been driven by brands buying up space. One land package was purchased for $913,000 by developer Every Realm. They intend to build a shopping district.
“In time, the virtual real estate market could start seeing services much like in the physical world, including credit, mortgages and rental agreements,” said the JPMorgan report.
▸ Disney Named Senior Vice President to Lead the Metaverse Strategy. Mike White will be in charge of "next generation storytelling."
▸ Crypto Influencers Alarmed by Canadian Government Actions. Actions by the government to quell the protests by truckers against Covid-19 rules sent shock waves through crypto twitter. The actions called for freezing bank accounts and crypto wallets.
A reminder to crypto holders who want to control their cryptocurrency to keep their private keys off of an exchange. (Private keys are passwords that control access to an owner's crypto currency.)
▸ Crypto Super Bowl Ads. There are usually a handful of outstanding ads and my favorite one this year was for crypto exchange FTX. Below is the data on how the crypto ads performed. The very funny commercial starring Larry David is at the bottom of the newsletter.
CRYPTO CLASS - Blockchain
Let’s start with the basics.
Spreadsheets like those in Excel or Google Sheets easily store information. You probably keep a spreadsheet to manage your business or personal expenses. It’s a great tool for one person or a small group of people.
When there’s a large amount of data that needs to be accessed by multiple users, a database is needed.
A database usually structures its data into tables. A blockchain behaves differently.
Data is gathered in groups or blocks.
A block has a limited storage capacity and when the block is full, it is closed. It is then linked to the previously filled block.
This continues and a chain of blocks are linked together – brilliantly referred to as the blockchain.
One superpower of the blockchain is that the data cannot be changed or deleted. It is immutable.
Here’s how that works.
A blockchain doesn’t live on a single server farm in a warehouse. The blockchain data is spread out amount many network “nodes” throughout the world.
According to bitnodes, there are currently 15,181 Bitcoin nodes. It’s decentralized.
Spreading out the data allows for redundancy. Unlike a company that stores all its data in one location, if a power outage or natural disaster occurs at a network node, the blockchain isn’t impacted.
It also ensures that the data isn’t changed. If someone running a node is a bad dude (yes, there are hackers who aspire to steal bitcoin) and alters data on their node, the other nodes in the blockchain will not be impacted.
Blocks are stored linearly and chronologically. It’s an ingenious way to keep records.
Blockchains can be public or private.
The Bitcoin blockchain is public or “permissionless.” Anyone can join the network.
All blockchains are secured with cryptography.
Private blockchains are being used by companies such as Walmart for supply management. Healthcare providers are storing their patients’ medical record. Property records in county recorders’ offices are ripe candidates for blockchain.
Go to Investopedia to learn more.
INFLUENCERS - People to follow
Jack Dorsey – Cofounder of Twitter. Founder of Block, a group of companies including Square, that focus on payment systems, tools, and services for small businesses.
Dorsey has been a vocal supporter of crypto and announced that Block will develop an open Bitcoin mining system that will build equipment and software to allow more people to mine Bitcoin.
Square, renamed Block, will build an “open Bitcoin mining system.” Bitcoin miners are the technologists who maintain the blockchain. Dorsey is developing a team of engineers to help build equipment and software that will allow more people to mine bitcoin. Dorsey has criticized the unchecked power that venture capitalists are having on the development of Web 3.0 (next generation of the internet).
RESOURCES – Books, websites, podcasts, articles Renowned Silicon Valley venture capital firm Andreesen Horwitz, known as a16z, has brilliant articles and papers on all aspects of crypto. There are also fascinating class videos from their crypto school. My favorite talks were from Chris Dixon and Balaji Srinivasan.
CRYPTO WORDS – Fiat is government issued currency, such as the U.S. dollar (USD) or China’s renminbi (RMB).
Here's the best Super Bowl ad. It's preety, preety good.
Thanks for reading. See you next week.
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