GULFPORT, Fla. - The Gulfport house listed for sale as an NFT is off the market, helping Tampa Bay made history in real estate.
On Thursday, the property at 6315 11th Avenue South became the first house to sell at auction as an NFT or non-fungible token using cryptocurrency in the United States. Pinellas County realtor Amy Heckler listed the house for the seller Leslie Alessandra, co-founder of the crypto company DeFi Unlimited. Lots of eyes watched the online auction as two anonymous bidders made offers over the digital market, but one came out on top. The house sold for about 210 Ethereum, a type of cryptocurrency, coming out to $631,790 after the currency conversion.
"This is the first time this has ever been done. Maybe there was a little trepidation among bidders and et cetera, and because it hadn't been done before," said Heckler, who said she hoped the house would sell for more.
The new owner now gets a physical house, instead of something purely digital, and the transfer was instant.
Heckler said real estate transactions may trend toward using cryptocurrency and NFTs, considering "what people might want to look at and which auctions they might want to bid on and why you might want to bid on this one as opposed to that one based on what type of coins are accepted.".
The house technically sold under its $650,000 asking price by the time the currency was converted, and that’s a risk with cryptocurrency. University of South Florida business professor Balaji Padmanabhan explained.
"So although you could say that 210 Ethereum, which is what it sold for was $650,000 at that point. Within hours, the range could have either been $688,000 or $650,000. That's a big range, right within a short period of time," said Padmanabhan. "With the amount of liquidity in that market right now, one house in that risk is quite low. Now, if the person holds on to the cryptocurrency, then you're riding the fluctuations of that currency."
Business experts said the auction was a big moment, but there’s work still needed, like ensuring real estate protections for all sales.
"I think the real estate industry will end up partnering with tech firms to create solutions for the buyer so that the buyer is just doing what they think is normal," said Padmanabhan. "But behind the scenes you have, like companies like the company that actually facilitated this one and real estate companies together figuring out how to set it up so that the buyer and seller can transact easily."
Heckler said the process was an adventure, and she’s ready to handle the next one that comes her way.
"We're looking forward to assisting people in the future to sell or buy property with NFTs and cryptocurrency," she said.
Business experts said the home sale marks the beginning of an interesting future for NFTs, not just in real estate but any physical product that could be tied to an NFT. Realtors said the next step is figuring out how to keep current protections for properties when working with cryptocurency on the blockchain.