BSV
$48.41
Vol 20.61m
6.38%
BTC
$71322
Vol 53635.97m
4.92%
BCH
$350.68
Vol 281.66m
6.31%
LTC
$67.29
Vol 381.19m
1.83%
DOGE
$0.18
Vol 5601.31m
13.25%
Getting your Trinity Audio player ready...

There are a number of companies that are beginning to offer programs to allow cryptocurrency holders to use their assets for loans and other financial solutions. Now, the world’s first crypto-backed mortgage has been launched and it could be a definite game-changer moving forward.

Nexo, a crypto lending platform out of Switzerland, issued the mortgage to Brock Pierce, the child start of the Mighty Ducks movies and an established crypto enthusiast. The home is located in Amsterdam and is reportedly worth $1.2 million, and backed the entire loan with Bitcoin Core (BTC).

Nexo’s co-founder and managing partner, Antoni Trenchev, explain to Fox Business, “So we take that bitcoin and other digital currencies as collateral using a third party qualified custodian to store it and give them fiat cash for it. But neither the client nor us have access to the coins.” He adds that the customers have instant access to loans of up to $2 million in 45 different fiats and that funds can be available within 24 hours.

Pierce asserts that the new platform can be the bridge between the “old world of traditional finance and the brand new frontier that blockchain now enables,” adding, “Being able to borrow against one’s crypto assets gives one options, when wanting to purchase a property, and aligns with my philosophy that real estate and tokenization will be a quadrillion-dollar market. I was able to hold on to my crypto and settle the transaction in fiat.”

There’s another benefit to deals like Pierce’s mortgage, at least under the current laws. If Pierce were to purchase the home for cash by converting his crypto to fiat, he would also be forced to pay taxes on those converted assets—they would be seen as capital gains. By leaving them intact as digital assets, he is able to cover the mortgage using his holdings and save himself from a major tax nightmare.

Nexo isn’t the first company to get into crypto lending market—BlockFi and Celsius are well entrenched. However, the market is growing and is proving to be popular among those who don’t want to give up their crypto holdings. Just like with fiat, the ability to receive credit with crypto assets is going to prove to be a powerful tool that could drive adoption higher.

Recommended for you

Tether execs draw dividends as threat of US indictment grows
Tether issued its latest quarterly 'attestation' of the reserve assets allegedly backing the $119.4B in issued USDT as of September...
November 5, 2024
Blockchain firm R3 looking for a buyer: report
R3 has raised over $120 million over the years, but broader market conditions have proven tough as its permissioned blockchain...
November 5, 2024
Advertisement
Advertisement
Advertisement