One property investor is so confident that the future lies in bitcoin that he is refusing to accept cash for the sale of a mansion worth £17 million in London.
Lev Loginov, co-founder of the property investment company London Wall hopes the move, which is thought to be a first for the capital, will kick-start a new era of property transactions in the cryptocurrency.
“We want to shift all the perceptions on cryptocurrency,” Loginov told London’s Evening Standard.
“We think in future it is going to eliminate the need for solicitors and property title and is really going to change how real estate transactions are conducted,” he said.
His company bought the property in Stanley Gardens in Notting Hill in 2013, converting it from flats back to a 6-storey house.
At the current rate, the house will set the buyer back around 5050 bitcoins.
Bitcoin is the world’s foremost cryptocurrency, launched nine years ago.
Last month another property seller said that he would accept either sterling or bitcoin for a £1.7 million house in Peckham, but this is thought to be the first property sale to insist exclusively on bitcoin.
At the moment it isn’t clear how commissions to estate agents and stamp duty on such a sale would work, but Loginov believes the London agents and tax office can figure out the issues.
With bitcoin having been implicated in drug-trafficking and tax evasion, Mr Loginov said that he and his business partner have hired advisers to ensure that the property transactions are not used to launder money.
Bitcoin smashed through the $5,000 barrier for the first time on Thursday. The biggest and best-known cryptocurrency, it has chalked up more than a fivefold increase in price this year.
“People are just wanting to be part of it,” said Ryan Nettles, head of FX trading and market strategy at Swiss bank Swissquote, which launched bitcoin trading two months ago. Nettles said interest had been much higher than anticipated and has come from banks, hedge funds, and brokers.
“The interest really stems from the media hype,” he added.
Though there have been many warnings about a bitcoin “bubble,” including from European Central Bank Deputy Governor Vitor Constancio, some say it has much further to climb. But determining its value is difficult.
“For most currencies there are several accepted methodologies for estimating relative value, normally based on macroeconomic fundamentals,” said EFG Asset Management Global Head of Research Daniel Murray. “For bitcoin no such fundamentals exist.”
Reuters contributed to the this report