The Power of Cryptocurrency Loans for Commercial Real Estate Investment
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With the price volatility of crypto-assets, many digital asset hodlers want to diversify their investment portfolio to unlock additional returns and stabilize values somewhat. The phrase “don’t put all your eggs in one basket” applies directly to this concept, as diversifying your portfolio is how one balances risk and reward.
According to studies by Cointelegraph, the amount of unmoved Bitcoin has increased significantly over the past five years and coins falling into this category have been held in the same wallet address for 180 days to 2 years. This suggests that Bitcoin is increasingly becoming a store of value. One could assume that if Bitcoin’s price continues to rise, so will the number of unmoved Bitcoin.
For cryptocurrency investors, there exists a conundrum: They may be crypto millionaires, but very few businesses accept Bitcoin, Ethereum or other digital currencies. People who own crypto typically exchange it for U.S. dollars to make purchases, missing out on potential value increases, paying hefty fees or incurring capital-gains taxes.
For people who sit on a large amount of crypto, commercial real estate can be a good way to leverage your Bitcoin or Ether without selling them. Investors can use their cryptocurrencies as collateral towards a cryptocurrency backed loan, which allows them to maintain ownership of their funds while gaining access to the USD they need to fund their projects.
Power Block Coin Crypto-Backed Loans For Quicker Cash Access
“For example, Dave Carlson, a technology investor and former Microsoft software engineer, who has been involved with cryptocurrency since 2012, said he has struggled to find ways to leverage his Bitcoin to buy ‘bricks and mortar’ assets. Carlson said he could have exchanged some of his digital assets for cash, but did not want to ‘miss out’ on future gains in cryptocurrency values.
In 2018, Carlson created Clever Capital LLC, which is a multi-million dollar fund that works with high-quality lending platforms to secure loans for the purchase of revenue-generating assets such as vacation rentals and commercial properties. He started with $1 million to purchase two vacation rentals at the Gorge Amphitheater in George, Washington and is now working with Power Block to expand and further diversify his holdings.
Power Block clients are able to receive cash typically within 48 hours around the globe, seize investment opportunities, and meet liquidity needs to buy an investment property. We offer better rates than most other lending sources who in many cases don’t take crypto as collateral for loans. With Power Block, there is no need for lengthy underwriting. Whether you’re looking at commercial real estate opportunities or to invest in Real Estate Investment Trust, the future value of a property has big implications on your purchase decision.
Carlson further explained, “So far the strategy has worked very well. The properties have nearly doubled in value while generating desirable rental income and, of course, the coins have enjoyed significant recovery in value from the Crypto Winter.
Carlson mentioned that the growth in the fund’s real estate and crypto asset values have far exceeded the interest rates of the loans.
“Thanks in part to Power Block, I’ve been able to meet my goals of diversifying my crypto assets into real-world investments, while still HODLing, I think its quite clever.”