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Propy Revolutionizes Home Buying with Bitcoin-Backed Loans

Writer's picture: Blockonome GnomeBlockonome Gnome

A groundbreaking move brings blockchain technology to real estate financing.


Propy Revolutionizes Home Buying with Bitcoin-Backed Loans

Propy, a blockchain-based real estate platform, is set to redefine property ownership with its latest initiative—a tokenized condominium sale in Honolulu, Hawaii. Starting at $250,000, the sale will allow buyers to secure loans using bitcoin (BTC) or ether (ETH) as collateral, merging the worlds of cryptocurrency and real estate in a way never seen before.


Natalia Karayaneva, CEO of Propy, describes this innovation as a game-changer for cryptocurrency holders. “It’s a great proposition for bitcoin holders,” she said in an interview with CoinDesk. “It’s not a taxable event. They get a loan and buy real estate with it, instead of exiting bitcoin, paying taxes, and then buying real estate.”

The loan, structured as a two-year agreement with a 10% annual interest rate, requires 100% collateral in cryptocurrency along with the property itself as additional collateral. While the arrangement provides an exciting opportunity for crypto investors, it also comes with inherent risks. If the value of the cryptocurrency drops by more than 50%, a margin call will be triggered, potentially leading to liquidation of the crypto holdings and an auction of the property. Conversely, if the value of the cryptocurrency doubles, the buyer could repay the loan entirely through their gains. Buyers can make loan and interest repayments in BTC, ETH, or USDC, adding flexibility to the process.


What sets this initiative apart is the tokenization of the property. Propy uses blockchain technology to create a digital representation of the condominium, significantly streamlining the transaction process and improving liquidity. Tokenization involves setting up an LLC for the property in the county register and creating a digital token that represents ownership. Once the transaction is completed, the LLC is updated to reflect the new owner, and the token is transferred to their wallet. This process, which takes approximately two weeks, highlights Propy’s commitment to leveraging blockchain technology to simplify real estate transactions.

“This isn’t just a milestone; it’s a glimpse into the future of real estate,” Karayaneva emphasized. “We’re demonstrating how blockchain technology can simplify home buying, replacing the traditionally lengthy loan approval process with an instant, efficient solution.”


Propy has been using blockchain smart contracts to reduce the complexity and costs of real estate transactions since its launch in 2017. While most of its clients are unaware of the blockchain technology powering their purchases, they appreciate the platform’s speed and transparency. Propy’s primary business involves escrow services and smart contract-based transactions, but it is steadily expanding its crypto-native offerings, like the Honolulu sale.


In addition to enabling crypto-backed loans, Propy has facilitated several high-profile blockchain transactions, such as tokenizing a 17th-century Italian mansion and turning TechCrunch founder Michael Arrington’s apartment into an NFT. However, Karayaneva notes that scaling these initiatives required the introduction of a crypto-backed loan product to meet consumer needs.


Propy’s tokenized properties are designed to offer flexibility. Once a property is tokenized, it can be sold to another crypto-native buyer without Propy’s involvement. If the token is transferred to a new wallet, the new owner can provide Know-Your-Customer (KYC) information, automatically updating the LLC to reflect the ownership change. Buyers also have the option to "un-chain" the property, reverting it to traditional ownership methods.


“Our premier goal is really to on-chain as many real estate assets as possible,” Karayaneva explained. “Imagine making an on-chain swap between a real estate on-chain asset and a bitcoin asset or another crypto asset. … It’s a $300 trillion market. Imagine if it becomes liquid.”


The tokenized condominium sale scheduled for January 29 is not just another real estate transaction—it represents a significant step forward for blockchain’s integration into the real world. Propy’s innovative use of cryptocurrency and blockchain technology could open new doors for tech-savvy investors and bring liquidity to one of the world’s most valuable markets.


photo source / Blockonome

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Blockonome's content is meant to be informational in nature and should not be interpreted as investment advice. Trading, buying or selling cryptocurrencies should be considered a high-risk investment and every reader is advised to do their own research before making any decisions.

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