By Kyle Backer | AZ Big Media
Jack Dorsey, co-founder of Twitter and CEO of Square, made headlines in March 2021 when he sold his first tweet as a non-fungible token (NFT) for over $2.9 million, which he converted to Bitcoin and donated to a charity assisting Africa’s pandemic response. The digital currency market is raising many questions, including how will NFTs and cryptocurrency impact Arizona real estate market?
For the uninitiated, an NFT is a digital asset that can be bought and sold like a physical asset. People are now buying NFTs for digital artwork, music, videos and items to use in digital spaces known as the metaverse. The record of the sale is stored in a decentralized digital ledger called a blockchain that proves ownership, akin to having the title for a car.
To create a smart contract, which NFTs transactions are based on, a buyer and seller agree to terms that are written into code and housed on the blockchain. The terms of the contract are self-enforcing without the need for a third-party facilitator.
Think of these smart contracts as vending machines. When the right input is applied — putting in a few dollars and pressing a button for a particular drink — there’s a guaranteed outcome without the need for a cashier to scan the item and process the payment.
“NFTs and cryptocurrency will revolutionize the entire real estate industry, so it will certainly impact Arizona’s real estate market. The only question is when. Not much has changed in the way we’ve done real estate in the last several decades, and there are many aspects that could use some improvement. Blockchain technology allows for increased trust, security, transparency, and traceability of data shared across the network – all of which could be beneficial to real estate.”
Omar Abdallah, Rose Law Group Web3 Attorney