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A Tokyo Stock Exchange-listed company has built a cryptocurrency settlement platform for real estate transactions. The firm has tested the platform using BTC and smart contracts for property sales and has released its findings; many benefits were observed over the traditional method.
BTC and Smart Contracts in Real Estate
Japanese real estate company Ruden Holdings (TYO:1400) recently announced the results of an experiment using its newly-created “virtual currency real estate settlement platform.”
The company explained that the trial, which involved BTC and smart contracts, was conducted in collaboration with Blockchain Global Limited (BGL). The two companies partnered in April to develop the settlement system and a “virtual registration data inquiry system,” Ruden detailed, adding:
For the settlement of bitcoins (BTC) used in the property sale, Bitflyer’s web service and API functions were used.
Some parts of the system, such as time stamping of the contract, used the NEM test network, the company added. Bitflyer is Japan’s largest crypto exchange by volume. However, the exchange halted registering new users after receiving a business improvement order from the country’s financial regulator in June.
The experiment began with a seller listing a property to sell and a buyer looking for one to buy. The buyer then filled out an offer to purchase the property, which the seller confirmed.
“The buyer then sent the virtual currency (bitcoin) to the Ruden company’s virtual currency account,” the company described, elaborating:
As soon as Ruden (system) confirms the remittance of the virtual currency, we will execute the contract and [convert the] virtual currency to Japanese yen. In addition, a notarized sale [and] purchase agreement is promptly shared with [the] buyer and seller.
Other forms including the property registration application and requests to acquire other necessary documents are also automatically sent in order to execute the sale of the property.
Many Advantages Over Traditional Systems
Ruden then outlined many advantages it observed from the experiment.
For buyers and sellers, the company explained that using smart contracts and crypto payments makes it “possible to drastically shorten the time required” to perform each step of the process, including depositing money.
“Smart contracts eliminate the need for manual work and conditions,” the company detailed, adding that “the time to negotiate and conclude can be shortened compared to the current work.” Furthermore, the system also reduces “trouble such as refusal” to hand over the property after payment has been made.
Overall, Ruden emphasized:
It is not only to improve the efficiency of operations, but also to prevent unforeseen circumstances.
In addition to building the two systems above, the company announced last week the establishment of an overseas subsidiary in Singapore for the issuance of its own token.
What do you think of using BTC and smart contracts in real estate transactions? Let us know in the comments section below.
Images courtesy of Shutterstock and Ruden Holdings.
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The post Japanese Company Trials BTC and Smart Contracts in Real Estate Transactions appeared first on Bitcoin News.
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Derivatives trading isn’t new, but it’s been enjoying a renaissance of late. As the cryptocurrency market has traded sideways, traders have upped the leverage and rushed to swap BTC derivatives that promise greater risk and reward. While platforms like Bitmex and Deribit have profited from the boom in synthetic assets, many traders have been left high and dry.
Derivatives Trading Is a Hazardous Pursuit With Little Margin for Error
Bitcoin investing is often portrayed as navigating a bumpy road, with each trough and pothole invoking a rallying cry to “Hodl” and persevere till the finish line. If the analogy is accurate, then derivatives trading is like speeding down that road on a motorbike at 160 mph. One false move – a flash crash here; a DDoS there – and it’s game over. Hit a pothole as a hodler and all you’ll lose is some USD off your portfolio. Do the same on 100x leverage and you’ll be liquidated on the spot. Trading synthetic assets, particularly on high leverage, is not for the faint-hearted. Nor is it for the inexperienced.
There are three types of synthetic options available to bitcoin traders: futures, derivatives, and margin. Some platforms, such as Bitmex, Whaleclub, and Deribit, offer all three. Traditional exchanges such as Bitfinex, Hitbtc, and Poloniex offer margin trading only, and then there’s the likes of Okcoin which offers futures and margin but no derivatives. Here’s how the three options play out:
Futures: A type of derivative contract that can include leverage of up to 100x, futures are an agreement to buy or sell an asset – in this case synthetic BTC – at a future date for a certain price.
Derivatives: A type of contract whose value is derived from that of another asset. On sites like Bitmex, it’s possible to trade options, swaps, and futures – all types of derivatives – with the possibility of higher returns thanks to leverage which multiplies the potential profit or loss, depending on how the trade goes.
Margin: A type of trade in which money is borrowed from a broker with the expectation that they will be repaid upon generating a profit. A minimum level of equity must be maintained on the platform, typically around 30%, to cover losses. If the balance falls below this, additional funds must be covered to account for the shortfall.
Derivatives Can Be Dangerous
Crypto Twitter and Telegram channels are filled with tales of woe from leveraged traders who got stopped out and had their position liquidated. If conventional trading is cocaine-like in its addictiveness, high leverage is crack cocaine. One of the biggest gripes for traders, particularly on Bitmex, is those unexpected events that can wreck even the best laid plans. Even experienced traders are taking a huge risk, over and above those associated with bitcoin’s ‘natural’ movements. DDoS attacks, downtime, log-in errors, and sudden price spikes have caused traders to lose everything. When such events conspire, there is little recourse, for complaining to the Seychelles-registered Bitmex will get you nowhere.
As discontent with Bitmex has grown, Deribit has welcomed traders with open arms. It professes to offer faster trade execution than Bitmex, but with only 50x leverage versus its rival’s 100x. Bitmex is still the whale in the derivatives market by some distance, recording 24-hour volume of 355k BTC versus Deribit’s 5k. Exchangewar.info notes Deribit’s lower fees, and there is also less controversy surrounding its margin trading – for now at least. No matter how reputable the platform traders choose, or how good its uptime, it should be acknowledged that derivatives trading is a dangerous business in which a handful of pros profit massively and the remainder are lucky to walk away with their initial stake.
Do you think platforms like Bitmex can be trusted, or do they introduce additional risks over and above those to be expected from trading derivatives? Let us know in the comments section below.
Images courtesy of Shutterstock, and Twitter.
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The post Synthetic Bitcoin Is 100x More Lethal Than the Real Thing appeared first on Bitcoin News.
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