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Ask HN: Cryptocurrency To Replace Real Estate?

by osswannabe on 9/14/20, 10:36 PM with 9 comments

The question is simple - is it possible to design a cryptocurrency to replace real estate as a store-of-value and generational wealth mechanism? If so, what features and/or design goals would you incorporate? To focus the discussion, I'm only considering feasibility in terms of RE-like price stability and long-term appreciation (not regulatory/tax implications). Personally, I think the biggest challenges are implementing illiquidity and regional market pricing (e.g. SF real estate prices don't really influence the NY market). As for why any of this matters, I've had this nagging (grandiose) idea that replacing real estate as an asset class can enable affordable housing on a global scale. Thoughts?

  • by wmf on 9/14/20, 11:36 PM

    replacing real estate as an asset class can enable affordable housing

    This is a great insight. Taking Germany as an example, policies to de-financialize housing lead to low and stable prices. China has been the opposite with the US in the middle.

    Ultimately investment gains have to come from somewhere; real estate "investment" has mostly ended up stealing unsustainable amounts from the next generation. Even if you could replicate that with crypto it would probably only work for one generation (if that).

    I guess government regulations created the housing market so you could imagine different government regulations (Sinagpore-style?) propping up some crypto instead, but that's not realistic today. Although... a system that almost every working person invests into then cashes out decades later sounds like US Social Security (except bigger and more harmful).

    the biggest challenges are implementing illiquidity and regional market pricing

    Why are these good?

  • by gus_massa on 9/15/20, 1:29 AM

    If you buy a house now, you know that in 20 years someone will need a house. (Assuming you select a nice spot, and do all the maintenance work.)

    With a cryptocurrency, you don't know if you choose the correct one. Will Bitcoin or Ethereum win the race? Which fork? Will they survive the transition from mining to fees? Will a PoS coin win?

    Why a cryptocoin is better than a bank account or a treasure bond or a tracker fund?

  • by Finnucane on 9/15/20, 12:49 AM

    If you want to disincentivize nonproductive investment in real estate (Such as buying up re and holding it unoccupied as a kind of safe deposit box) that could be done with taxes and financial regulation. Where the money goes after that is not really our problem.

  • by Finnucane on 9/14/20, 10:47 PM

    Can I get a 3-bedroom bitcoin a 20-minute bike ride from work?