Crypto & Real Estate Transactions

Hey everybody! What’s up? It’s Justin Live from B2B Vault: the payment technology podcast with your host, Allen Kopelman and we’ll be providing you with educational information about, business, payments, FinTech, decentralized finance, and the technology businesses use in today’s world. And in today’s podcast, we’ll be talking about cryptocurrency and real estate transactions.

It’s a big thing in the news lately, down in Miami a guy sold a multimillion-dollar home, and they use cryptos, it’s all over the news. People are like, oh my God. And then there are other things it’s in the news, you could actually buy an NFT with crypto and the NFT gets built into an actual physical house.

So that was cool too. There are just a lot of new things that are going on with crypto and real estate and, just lots of different technology coming around with cryptocurrency in ways that you can use it, so! You want to tell people about the exciting contest! Oh, before I forget, we have the Meta Quest 2!

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Hopefully, in the future, we’ll be able to have a contest to get you guys something, but until then we can only ship in the United States of America. So, please. And when you enter, it sends you back an email, you have to confirm. Oh yeah. Cause if you don’t confirm the email address, I’m not, you’re not eligible to win the prize.

So, you must confirm the email address. It must be a legitimate email address. Otherwise, it’s not going to happen, and you won’t win the very cool Oculus. So, you could play in the metaverse with all your friends. Yeah. It’s pretty cool. Oculus? Oculus! Yeah, the Oculus it’s pretty awesome. So, let’s get into, real estate and crypto and some of the things Justin mentioned in the intro, it’s very interesting.

We’ve been getting Some phone calls from some title companies and attorneys lately. And they’re inquiring about our services and can like we’re working with a guy now they want to clear; they have a, someone wants to buy a condo and pay with $1.1 million and pay it all with Bitcoin! Cool. So, it’s a, it’s pretty interesting space.

The largest crypto deal that took place in Miami was a 2 22 0.5 million deal to buy a condo. And the condo, interestingly enough, was in a building, apparently, Jared Kushner and Ivanka also lived in the same building. Oh really? It was in Forbes magazine in May of this year. And then another big story was in Tampa.

This guy decided to auction off his house. And then part of it, you got this, the guy made this elaborate NFT that showed the whole house, like 3d house, and then the property, and then the whole inside of the house, like in a video. And it was like a really cool thing. And it was in an auction and that’s all for $654,000 back in February of this year.

And it was 210 Ethereum at the time. So, I don’t know that house went down in value because it’s tied to the NFT. One of the things that we see going on where we’re getting a lot of requests from businesses that are starting up are businesses who are doing a thing. I don’t know, I call it clicks and bricks.

So, where you could buy a space or a building in the metaphor, but then it actually exists in real life. So, it’s, a guy is trying to put together a deal where they’re building this condo building, and then each condo is also going to be NFT. So, it’s pretty interesting! And there’s, they’re building a lot of

cryptocurrency, even though the price has gone down, there’s definitely some long-lasting effects because the other day, I think, I don’t know if I’m if I wrote it down, but there was a bit, a lot of transactions where there was a ton of cryptos sold off in the last, like two or three days. Oh yeah.

It was like 52 billion or something like that. But somebody bought it! Because it doesn’t just go into the air. It’s not like they sold it and then it just went poof and disappeared. Somebody bought that crypto! So, people the crypto and the reason and people don’t understand why did the crypto prices go down?

So, the crypto prices went down because of a few factors, factor one is the new tax laws. So, the new tax laws, if you hold in crypto, you have crypto and you didn’t hold it for a year. You’re subject to capital gain stacks. That’s number one, number two, that also prevented people from trading crypto so people couldn’t do what they were doing before was all this day trading.

And that was driving the price up. So, they would buy crypto, then when the price went up, they would sell it. Then the crypto would go down, five, 10 grand. Then they would buy more and go up and down and make. On the up and down, just like the stock market.

Yeah. guess the government didn’t like that too much. And it said if you’re going to have to pay tax on these trades. So, the traders all started pulling out of the crypto market and that’s what basically forced the price down because they were artificially driving the price. Another episode that caused the price to go down was that the government, the IRS had seized,

I don’t even remember if it was millions or billions in Bitcoin, from people who didn’t pay taxes and they rated their wallets. And said Hey, wallet, company. And so, owes a million dollars in tax, we’ll take a million dollars of Bitcoin. And then they started selling off that coin. A lot of it like, and that also caused the price to start to go down too.

So now it’s settled down, but Bitcoin, I’ve talked to a bunch of realtors and these title companies and they’re like, yeah, people that are in a foreign country. Want to use cryptocurrency, whether it’s Bitcoin, it’s mostly Bitcoin and Stablecoin, is what they want to use. So, we’re working on a solution for Stablecoin right now.

And the reason they want to use that is that it can be, the transactions can be quicker and faster doing start doing it that way, then sending the money through Swift, and all these things to get the money into the bank account. So, we’re talking with a few companies who want to do that and we’re getting them set up so that they can get set up to do that.

They have to have a special. The lawyers or escrow companies, and title companies have to have a special SBO account, which they probably already have so that they can receive those funds. And then it’s non-taxable because it’s all going out because they’re the distributor of the funds.

You know how it works! They get the money and then, oh, this much goes to the owner or the mortgage company. And then this goes for the taxes and the insurance and so on and so forth. And they think as the realtors tell me, they think like this is just going to be a growing trend in the next, five years.

There are going to be a lot of purchases of property using crypto! I believe it. So, it’s going to be, so people always ask oh how do you know how does it work? And what are we doing, in this space? So, one of the things I want to just make people let people know is you have to make sure that you’re not causing what we call a taxable event.

Okay. So, a taxable event is I’m going to send Justin some crypto. I’m going to make it simple. So, I send it to you. Give me your wallet address. I give you I say, oh, I want to send Justin a thousand bucks of crypto. Now, when I send my crypto, I create a taxable event on my side. When Justin receives the crypto, he’s also created a taxable event, but if he doesn’t cash it out for a year, he holds the cryptos for one year.

With the tokens for a year, then the tax is much, much lower, he’s taken a risk. So how do you create, because I’ve seen a couple of these real estate transactions and I was like no like you guys don’t realize like you’re going to have to deal with you created a taxable event! Because you sent money from,

you had somebody send money from their wallet to your wallet, and then you sold the cryptocurrency. What? And you facilitated it. You facilitated several taxable events, okay. So that’s a problem. The way we do it is, say I’m the title company, and we’ll say, Justin’s going to buy the house and Samantha’s over here filming us for social media and she’s, so we’ve involved everybody in the transaction.

So, as the title company, Justin’s buying this 1.5 million mansion, there’s a boat back in the back. It will be good! So, I send him the invoice for the 1.5 million in Bitcoin. He receives the invoice by email, and then he’s going to click, he wants to pay with Bitcoin. It’s going to tell how much Bitcoin he needs.

And then the QR code is going to appear and the blockchain address. So, he’s either going to take his phone out unless he’s on his phone and take a picture of the QR code with his wallet and send the money or copy and paste the blockchain address into his wallet and send the funds across. The funds are going to come across into the system that we have that system.

Is controlled by what’s called a custodial wallet. The custodial wallet receives the funds. And then the funds are immediately sold. That Bitcoin is already sold. And then, the transaction literally takes a minute because the price of the coin was already determined when Justin click the button.

Like what the price was that was getting bought at. So, it’s already been pre-sold. When he hits the button, it’s been pre-sold, and that price is good for 15 minutes. Let’s say he wants to wait, maybe the prices are going up and down so he can close that out, go back to it and then get the best, go to his best

conversion on it. And some people do that. They’ll wait till the middle of the night to get the best conversion. So, then the money’s in now the money’s back in my bank account, and I, and let’s say Samantha’s the holds the mortgage on that house. So now we’re going to send

what’s owed on the mortgage to the mortgage company, all the things that are on the closing statement get paid out of that. Because I’m the title company, I pay everything out, and then that’s, it’s a done deal. And nobody had, and there was the only taxable event on Justin’s side because he sold this crypto, but now he bought a house.

He goes to his accountant, and they work it all out. Simple, right? Yeah, simple! So, we make a very simple process for realtors to get involved and find title companies and will soon be, putting it out there. What title companies are signed up for our service, and then realtors can connect with the title companies and get transactions done!

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Yeah, so it’s pretty cool. And that’s also the apply now button. That’s how you can get set up with crypto. And we always say, we give a free 15-minute consultation. So, if you want to accept crypto at a business, and we see a lot of businesses that sell high, do high ticket items, taking crypto jewelry stores, diamond dealers, luxury cars.

This is where the crypto market is right now. There are still people getting paid with crypto, their salary, or part of their salary with cryptocurrency. There are a lot of people, Bitcoin 2023, they’re selling tickets left and right today thing. So, there was a lot of stuff going on with crypto.

Although I think in the future that we’re going to see, a move to Stablecoins because I also was seeing a big, I saw an article recently about several government agencies. Before you keep going. Yeah. My, thing with Stablecoins is yeah, doesn’t that just like basically go right backward. That takes

the whole idea of crypto away. What they talked about well, part of the problem with Stablecoin is some of the Stablecoins, especially the one that one Luna that took a dump. Yeah. They were linked to Ethereum and Bitcoin. So, there’s the US, there’s a couple of Stablecoins that are linked specifically to the U.S. dollar.

So, it’s a dollar and it’s worth a dollar! But that’s my point. My point is that, so let’s say you want, you don’t want to have some volatility, but you’re looking for someplace safe to put your money. But then it’s still regulated? But you’re not in the United States, you’re in another country.

You want to buy something here. So instead of buying Bitcoin and then the prices going. No, I get that, but I’m just saying like moving forward with Stablecoins at the whole point of crypto or Bitcoin, or whatever coin you’re talking about was to replace, the U.S. dollar. But you’re replacing it with digital currency. But a Stablecoin is backed by the government?

No, not right now it’s not! The U.S. dollar. But I’m saying that’s what the coin is based on the U.S. that’s my only coin based on the U.S. dollar. But all Stablecoins are backed by the government dollar. No! Are you sure? Yes! Okay. Hundred percent! I don’t know, I’m not crypto God, whatever. But so, there are only two coins. My point is,

so, all I’m saying is, yeah. Once you take it away and you make it a Stablecoin. Yeah! Isn’t that literally, like it’s basically taking away the whole point of crypto. because it’s supposed to be decentralized. There’s not supposed to be any regulation. It is decentralized, but there’s no regulation or anything.

There’s going to be regulation the government’s already trying to regulate it. But I’m just saying, I’m not trying, I don’t want to argue. I’m just saying at the end of the day, the whole point of crypto was to keep people out of it. So that you could make a transaction without being taxed and all that other thing.

And with Stablecoin when you introduce Stablecoins it’s not the same concept. I understand that. Right now, we have more, first of all, you have rules from the SEC on NFTs and crypto, you have rules from the IRS on NFT and crypto, right! So, there are rules. Now, Europe has some rules, it’s a lot looser over there. But the point is I think that the reason people want to see Stablecoins is to do international transactions.

Somebody’s in another country, they want to buy something, so they take their currency, whatever they buy U.S. Stablecoins, and then they can transact with people in the United States easier and not deal with the volatility of Bitcoin going up and down, or Ethereum going up and down. Ethereum’s lost more than half of its value. I guess for me, it is just It’s pointless. There’s a problem in that industry right now. It’s going to evolve and change. Crypto is in trouble. Right! It’s going to evolve and change the minors. We got a bunch of companies in trouble right now, like Voyager, and most of that was linked to loans and it wasn’t, it’s not even linked directly to crypto is a link to loans because you could take, let’s say a Bitcoin was worth $60,000.

Go to the comp and say, hey, I want to stake this. And then they would loan you money. So, you stake a coin. They say, oh, we’ll give you 60%. So, it’s worth 60 grand. We’ll give you $36,000. Now your Bitcoin’s worth 20 grand. They want 16 grand back because your loan-to-value ratio is off. So that created a problem for a whole slew of companies.

Celsius people were buying houses. Taking Bitcoin and they weren’t selling the Bitcoin, they were staking it. So, they staked a million dollars worth of Bitcoin and then bought a million-dollar house. Now that Bitcoin’s. 300 grand instead of a million. So now they’re in tr these companies that loaned out that money is in big trouble, and they got to, they’re calling the loans! Right.

So, they want their money, and they need their money back because they, it’s their upside down. That’s part of the problem, with cryptocurrency. But I think we’re going to see changes in that. We don’t give tax advice, you need an accountant, you can send us a message.

We’ll refer you to some accountants that work with cryptocurrency. Get, we don’t give financial advice about buying, selling, whatever, but we’re going to, I think we’re going to see that everything evolve, and there are bills in Congress right now being brought up in the house and the Senate and the finance committees in both the house and the Senate are discussing different bills on protecting the consumer when it comes to

Consumer protection when it comes to cryptocurrency. Because there’s been also a lot of people that got ripped off, they didn’t know, oh, I went and bought $10,000 worth of Bitcoin or stable coin gave it to some company because they were staking it. Which they were led to believe is like putting it in a CD.

It’s not F D I C insured. So, then whatever those companies made bad loans and then those people lost their money. So that’s what would happen. If one of these. Tragic. Right! If one of these crypto exchanges went bankrupt, right? Whoever’s got coin there. That’s why people who have ton who have tons of coins, have a little device, a little box hooked up to their computer and they download all of them

blockchain information into the device. Like it’s a USB, and they keep all their coin on there. They don’t even have; they have an accountant coin base with maybe a little coin in it or somewhere. But the majority of their coins are stored on a third, external, yeah!

On an external device so that’s what people do. But I think that we’ll see what happens with, we’ll see what happens, but there’s no Stablecoin right now. That’s backed by the U.S. government. The United States government is looking at that the central bank coming out with a central bank coin.

That’s not going to, how long is it going to take the government to go make a cryptocurrency? They could do it tonight! If they wanted to, they could call up Bill Gates or Elon Musk and spit out a coin. Exactly. But you don’t see them doing that so fast. No, because the government doesn’t want the

people to stop using the Fiat. They don’t want people to stop using the U.S. dollar. It’s confusing because they say, oh, we should have a cashless society. So, we should have this virtual money, but then they don’t know what to do with it. I don’t know. It’s a, it’s an interesting thing. I think the crypto is going to stay strong!

I think we’re going to see a lot. A lot of it is going to be focused on doing business internationally because it’s a lot safer than doing credit card processing. It takes a shorter amount of time to conduct a transaction than using money transfers and Swift and all that. And I think, from that standpoint, maybe as an, in, as an investment, maybe it’s not going to be a great investment until maybe there’s some less regulation when it comes to buying and selling.

Of the crypto, but the same thing, if you buy and sell stocks, you pay capital gain tax on that. So, that’s just something that, we’ll see, wait and see what happens in the future with regulation. But like we said, Bitcoin, the cryptocurrency and real estate are going to be growing.

I think it’s a, there’s a strong market. There’s definitely a lot of interest in the solution for international buyers, buying property in the United States. And so, it’s going to be, it’s going to be strong. Makes sense! We’re getting, we got probably half a dozen inquiries in the last two weeks about it.

So, I think there are definitely people looking to set their companies up so that they can facilitate these transactions. So, hope everybody enjoyed the podcast today, enter the contest, and follow us on social. Catch the podcast on YouTube we’re found everywhere! B2B Vault. Peace Out! Don’t forget to enter the contest!