Why do sellers like buyers that can close quickly and all cash? The closing process is brutally long, mortgage contingencies are nerve-wracking, and there's too much money going to too many third parties. Know what would make the process even quicker? A digital currency like Bitcoin, according to the Harvard Business Review. Bitcoin's advantages as a smooth peer-to-peer payment system are well known, and it's not a huge leap to envision the currency simplifying the sale of commercial property. Its public ledger system (the blockchain) would streamline due diligence with verification and record of the building's past ownership, inspections, certifications, leases, etc., and both parties could transfer title with a tap on an iPad. (Plus cash is rife with bacteria.)
Bitcoin could also improve transparency of contracts (like leases) and its cryptography could lead to virtual identity management (goodbye ugly passport photos), the article says. We're not sure what the currency might mean for brokers and lawyers, but it's definitely technology to watch and harness, no matter where you operate in the commercial real estate industry. (Though it might change negotiation tactics, which often rely on shrouds of mystery, and passing a piece of paper across the table.) It would take years and a good rebranding campaign for Bitcoin to reach these proposed heights, along with a trustworthy track record and improved operability. Do you think it could work? We want to know. Tell dees.stribling@bisnow.com
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