Blockchain startup Propy plans first-ever auction of a real apartment as a collectible NFT – TechCrunch

We have previously written about Propy using blockchain technology to smooth real-world property sales by introducing the concept of smart contracts. Propy was the first blockchain startup to make this work. Today, the company is once again pushing the boundaries, auction of a real apartment in NFT. While one might want to dismiss this as a stunt, the event is designed to make the case that it could well be done legally. And, damn it, they’re gonna try.

The auction will be for the NFT attached to a brand new, modern one-bedroom apartment in Kiev, Ukraine, with which Propy has already made history by making it the very first blockchain-based real estate sale.

The NFT created by Propy will, he says, transfer beneficial ownership of the property. Just in case you haven’t noticed, NFTs, or non-fungible tokens, are cryptographic “tokens” that represent a unique asset – like a work of art, music, or other collectibles. – and certify the property digitally. NFTs set the crypto world on fire with their potential to apply just about anything, including a Banksy piece of art that was later burned to the ground.

Once someone has won the apartment’s NFT at auction, the NFT will include access to transfer of ownership documents; an NFT digital artwork by popular Kiev graffiti artist Chizz (a physical painting of the digital artwork is painted on a wall in the apartment) and the apartment photos. But obviously the apartment is the main asset here.

The auction itself will run over a 24 hour period, with the initial listing starting at $ 20,000. Details of the NFT sale are available here and will be updated with any new information as the auction proceeds.

The apartment in question currently belongs to Michael arrington, founder of this news site, and now a crypto investor with Arrington XRP Capital.

Investors in Propy – which says it has processed $ 1 billion in transactions so far through its platform – include Arrington himself and Tim Draper, former founder of DFJ.

Natalia Karayaneva, CEO of Propy said: “This NFT will go down in history. For Propy, this is an important step in harnessing the promise of blockchain technology and non-fungible tokens (NFTs) to achieve “stand-alone” real estate transactions and real estate participation in the decentralized financial economy. “

Here’s how it will all work: Arrington has signed legal documents designed by Propy’s attorneys for the NFT to transfer ownership to a future buyer. Propy then proceeds to the NFT auction and receives payment in cryptocurrency. The winner of the auction becomes the owner within a minute, after filling out the KYC details.

The Kiev property is owned by a US-based entity, and once the auction ends, the new owner of the NFT becomes the owner of the entity and therefore the property itself. This process is repeated each time the NFT attached to the property is resold.

In an interview with me, Karayaneva said, “We were just thinking and it seemed like a natural development of our 2017 white paper. And in fact a lot of the stuff that we deal with, real estate, through ownership, we sort of already do that. NFT, but with our unique smart contracts. But now the NFT concept offers a different approach, where ownership can be transferred between two portfolios, on an equal footing.

“So we don’t need to change the owner’s name in the land register. And this applies to many countries, as well as the United States. This model will work for the United States, and overall there is this notion of buying real estate through LLC in the United States to preserve the privacy of the owner.

During the same call, Arrington added, “Approaching this from a cryptographic perspective, we’ve seen what’s going on how DeFi plugs into the credit markets. If I have an NFT or DeFi asset, then I can borrow against it, with no middleman. Right now if I have real real estate there is no way for me to borrow against it without a middleman because I have to go through a bank and get a mortgage or whatever. And it’s also the friction, all the costs in terms of speed and time that it takes.

“If we can find a way to connect real estate and other real-world assets to DeFi, I think the amount of credit that can be created around that is in the billions of billions, eventually. And so I think it has to happen. The questions on this are legal and regulatory… The legal questions on this are difficult, and so Propy has done a lot of work with it. But if they do, I think the idea of ​​an NFT representation of a real world asset just from the point of view of ease of trade and ease of access to credit markets is a great idea. . “

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