Man Profited $1.3 M for Purchasing Home Using Bitcoin
Bitcoin is a profitable yet an unapologetically unpredictable cryptocurrency.
Cryptocurrencies are an archetype of alternative currencies, utilizing cryptography to secure its transactions.
Cryptography makes them difficult to counterfeit, and transactions involving Bitcoins attract a minimal processing fee as compared to the high fees charged by most financial institutions for wire transfers.
Another advantage of using Bitcoin lies in its Blockchain structure, which serves as an online ledger for transactions and ensures a data structure that isn’t prone to hacking threats in addition to enabling copying of the ledger across all computers using the its software.
Likewise, another advantage of Bitcoin is its high level of anonymity.
However, Bitcoin isn’t immune to hacking as theoretically depicted.
In the cryptocurrency’s brief stint in the financial market, the entity has encountered over 40 thefts with some of them exceeding $1 million in value.
On the flip side, Bitcoin has its disadvantages.
Bitcoin is an organic currency in the sense that it is virtual, and hence not issued by a central repository.
In blunt terms, this means that an entire Bitcoin balance can be wiped out by a computer crash in the event of a backup copy not existing.
Moreover, the rates of exchange of cryptocurrencies are prone to unpredictable and unsettling fluctuations due to the supply and demand nature of its valuation, resulting in Bitcoin’s high price volatility.
In fact, its price volatility is one of the main reasons for the reluctance to its mainstream adoption.
While a good number of people are still avoiding Bitcoin use due to this, one man’s stars aligned when he made an unforced kill out of it.
The man bought a house in California using Bitcoin and ended up making an impressive $1.3 million as profit.
The man under recent focus is a wealthy new homeowner in Los Angeles who was made more wealth courtesy of Bitcoin’s fluctuation.
Bitpay’s Chief Commercial Officer, Sonny Singh, chronicled the events leading to the climax punctuated by the high profit.
Singh spoke in a recent Bloomberg Review interview and elaborated on the scenario.
Bitpay, Bitcoin’s payment service provider, was approached by a real estate developer who sought help in facilitating a transaction in which a home buyer wanted to pay using Bitcoins.
Singh confirmed that it wasn’t the first time Bitpay was facilitating Bitcoin transactions in real estate purchases in recent years.
Bitpay walked the real estate developer through the entire process.
The two parties would later reach an agreement for the Los Angeles, California property which was valued at $4 million at the time.
At the particular time of signing the purchase agreement, Bitcoin was valued at $750.
At the time the transaction took place, the price of Bitcoin had shot to $1,000.
The purchaser received a straight-forward 25% windfall at the end of the purchase.
The home buyer proceeded to buy a Lamborghini at New Port Beach with the extra coins in his purse; the car dealer was likewise paid using Bitcoin.
In as much as this story effortlessly paints cryptocurrency as something for the wealthy, Singh was quick to dismiss that notion.
He was quick to note that most people using Bitcoin outside America were not wealthy.
He pointed out that Bitcoin is working for regular people all over the world.
For instance, in Asia, Bitcoin is an attractive remittance option compared to other money exchange services.
This is attributed to its affordability and speed when contrasted to international wire.
Bitcoin has its downsides, but there are notable successes to be found with its use and it is getting its warranted attention.