Russian Real Estate Firm Experiments With Selling a Luxury Mansion for Bitcoin
The owner hired the real estate company to sell his mansion for $8 million worth of BTC.
The Russian real estate firm Kalinka Group has announced that once of its clients is selling his luxurious home for bitcoins. The 4200 square foot country mansion is located in the village of Nikolino, situated in a fashionable neighborhood off the Rublevo-Upenskoe highway. According to the Kalinka Group, this is the first time in the history of the Russian real estate market that a client has offered to sell a property for cryptocurrencies.
"Such transactions are still a novelty, even for world real estate markets,” Ekaterina Rumyantseva, the chairman of the board of Kalinka Group, said in a statement. “We are pleased to be pioneers and open new frontiers in business.”
She pointed out that Russian legislation has not yet defined the rules for working with bitcoins, and so far there is no legal definition of the cryptocurrency. Also, as there is no regulatory or legal framework governing the sale, the agency's service fees will still be paid in the national currency, rather than in bitcoin.
The legal department of the Kalinka Group is currently investigating whether the sale of a property for cryptocurrencies is legal, according to the laws of Russia.
The real estate firm cited China and Switzerland as examples of countries that consider bitcoin to be a tangible asset, which means a transaction is possible under the “barter agreement.”
However, if cryptocurrencies are considered cash in Russia, according to the law on foreign exchange operations, a transaction in BTC would be impossible since the only currency permitted in the sale of Russian real estate is the Russian ruble.
Kalinka Group recognized that volatility is another issue to consider when property sales are listed and transacted in cryptocurrencies. The real estate company acknowledged that bitcoin is much more volatile compared to other currencies, thus, exchanging the payment into rubles can “significantly change the value of the object.”
"The sale of the house in Nikolino will probably become a precedent in the legal practice and real estate market. We [will] carefully study the world experience of conducting such transactions and understand that cryptocurrencies should be described at the legislative level in the shortest possible time because this innovative method of settlement is already able to affect the money turnover in business,” Rumyantseva said.
Kalinka Group added that since bitcoin is volatile, the exact value of the designer-furnished mansion — which has an open-air jacuzzi and a movie theater along with many other luxurious features — will have to be determined at the moment of the sale. At the time of the announcement, the house was listed for 3000 BTC.