Recently, a Philadelphia Real Estate company announced that it would accept bitcoins and litecoins for all of its properties. Most of you are probably wondering, what’s a bitcoin?
At its most basic, a bitcoin is virtual currency. Unlike other forms of currency, they only exist online and in the form of encoded computer files. You can use them like any other form of online payment for goods and services. One US dollar is worth roughly .0011 bitcoin, but the value of bitcoin is constantly fluctuating.
Bitcoins operate on a peer-to-peer (P2P) as opposed to a client-server network, meaning you deal directly with the person from whom you’re buying. For example, if iTunes were a P2P as opposed to a client-server network, you’d be purchasing your music directly from Rihanna and Daft Punk.
Bitcoins and litecoins (because the currency is literally weightless, get it?), which are almost identical to bitcoins, are now accepted at a Subway in Pennsylvania, by lawyers, at art auctions and even by a barber. Most recently, real estate has thrown its hat into the bitcoin (BTC) and litecoin (LTC) ring.
BitcoinProps.com and Litecoin Properties, the same company with two different websites, is a Philadelphia property wholesaler specializing in as-is, rehab and fixer-upper residential, commercial and industrial properties as well as vacant lots and rental properties. If you take a look at their listings, you will see that they are, in fact, “fixer-uppers” (check out our “Real” Estate Dictionary” for the term’s actual meaning, incredibly accurate in this context).
The single family homes range from 16.63 to 83.33 BTC/665 to 3,333 LTC, approximately $15,520.55 to $77,770.76. The vacant lots range from 8.08 to 375 BTC/323 to 15,000 LTC, or about $7,540.95 to $349,982.42. In total, BitcoinProps and Litecoin Properties have 66 active listings.
While some aren’t located in the best neighborhoods, President Adam Ehrlich stated on Reddit that he hopes to “reduce urban blight in Philadelphia by putting these properties in the hands of people who will fix them up.”
It’s entirely possible that Mr. Ehrlich has had some trouble getting these properties sold, which is why he’s taking bitcoin and litecoin for them in the first place. Why some may argue he’s ahead of the curve, amassing virtual wealth at the right time, others may find the transaction of real, physical goods for virtual money risky; especially with the volatile nature of the new currency’s value (it took a nosedive from $260 to $63 per bitcoin this past April).
We hope that bitcoin is worth all the hype and that Adam Ehrlich gets ridiculously wealthy by selling property for it at the ideal time, then selling his shares of bitcoin at peak time for the most possible profit. But even if he ends up taking a hit due to a plummet in value, at least he’s making history and trying something new, and we applaud that.