Blockchain real estate platform Propy has partnered with Abra to enable customers to obtain home loans using their cryptocurrency holdings, potentially expanding financial use cases for digital assets.
Propy customers can now post digital assets as collateral for their real estate purchases through Abra Borrow, a cryptocurrency lending and borrowing service. The crypto collateral pledged on Abra is used to borrow US dollars which can then be applied to home purchases.
The Propy blockchain records the entire transaction process, serving as a technical and legal framework for buyers and sellers. According to Propy, the blockchain records the transaction whether it is made in crypto, non-fungible tokens (NFTs) or traditional fiat currency.
Propy Founder and CEO Natalia Karayaneva told Cointelegraph that access to DeFi and crypto mortgages is a “key element to making crypto and NFT property sales and purchases viable for a wider population.” In a next step, the company is planning an “NFT sale of real estate” with instant mortgage approvals.
Abra is a crypto-focused wealth management platform that has been around since 2014. The platform allows users to earn a return on their crypto, borrow dollars against their holdings, and trade digital assets. Abra has received backing from several major companies, including Amex Ventures, the venture capital arm of American Express, which contributed to its $55 million Series C funding round in September 2021.
While early crypto investors have generated significant wealth over the years, their access to traditional financial products such as mortgages remains limited. Decentralized finance, or DeFi, apps are trying to fill the void. As Cointelegraph reported, a new homeowner in Austin, Texas recently purchased a property through a mortgage obtained from USDC.homes, a crypto lending service based on Circle’s USD Coin (USDC).
If you buy a house in the future, you will probably use NFTs. Here’s how crypto is changing real estate in the meantime. https://t.co/jiLT9Uojvd
— Cointelegraph (@Cointelegraph) February 19, 2022
Related: Web3 solutions aim to make the US real estate market more accessible
Fintech startup Milo also offers crypto mortgages for homebuyers looking to use their Bitcoin (BTC) as collateral. Meanwhile, decentralized mortgage lender Bacon Protocol launched a program in September 2021 that allows homeowners to trade a lien on their property for an NFT that represents a percentage of the property they purchased.