Tim Draper discusses how a buyer purchased a $250,000 condo in Oahu using a Bitcoin-backed loan at 100% loan-to-value, avoiding the need to sell. The sale was tokenized on Propy with smart contracts handling deposits and automatic ownership transfer, and Draper argues putting property deeds on-chain could eliminate title insurance and increase liquidity.
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$250,000 worth of Bitcoin. And the great thing is he didn't have to sell it. So he's leveraging it. Right. And so he doesn't have to sell it. He doesn't get taxed on selling it.
So the first Bitcoin-backed loan to buy a property, tell us about how that went down. That was huge news.
Yeah, it was really cool. Um, it was in Hawaii on the island of Oahu and it was a, it's a condo. $250,000. And so the owner of the condo wanted to NFT the project, one, like he's the one that wanted to do this, right? And came to us.
Right.
So of course we're like, yeah, let's do it. Let's see, let's, how do we just do this? And so we did it. We NFT'd the property. Uh, we put it on auction. We had a, I believe it was a 72-hour auction. Um, but everything was done by smart contracts, right? So, um, if anyone wanted to bid on the property, they had to go through the KYC and AML and proof of funds, right? They had to source their funds and all of that, just as normal. Um, once they were in and they, they got approved, they put money and deposits into smart contracts, right? And they were able to bid. And so at the end of the auction, as soon as the auction ended, whoever was the highest bidder, smart contracts engaged, funds got released, and ownership exchanged hands Wow. And so, this all happened on actually on a Saturday when real estate—
When everything else is closed.
I know.
Traditional markets, right?
I know.
This is, that is huge. That's really big. Congratulations on that. I mean, I know that that's shocking to a lot of people, but this is just going to be, I believe, truly believe that next, just part of our lives embedded in the way that we do things from here on out. Very, very soon in the very near future. Yep. Uh, faster than people might think.
Well, the, The cool thing about that specific one was, yes, the engaging of how the transaction itself, how it unfolded was amazing. Right? That's how the future of real estate should be.
Right.
Okay. But what's really significant about this is that we did a backed loan with 100% LTV. Okay. So he, the person that came in with, that bought it, came in with, it's being held. So it's a beautiful product.
And these are the kind of things that people who know about money and have that financial literacy have been able to take advantage of. And now actually it seems the whole world is starting to learn about this in real time as it unfolds. The average consumer can access this type of system too. I mean, it's just brilliant. And they say like, you know, this is kind of like what Michael Saylor is always saying, you know, don't sell your Bitcoin, use it, leverage it, keep it there. Um, and it's just a fantastic way to extend the wealth and to maximize it, right? Like, that's also another element that people are just learning for the first time, potentially through Propy, right? And these transactions.
Well, that's the issue. Not an issue, but Bitcoiners don't want to ever sell. No, they don't ever want to sell. They didn't want to do it. So there's, we've got to figure out a way to evolve the industry around people like that, right? Because we can't just say, oh, you're not willing to sell, then you're never going to buy real estate again. It's just not fair. Um, but I even think like, even where the market currently is right now, like we, the stars are starting to align and we're starting to see like this perfect storm right now, because obviously what's happening with Bitcoin, right? Pricing is going up, but there's going to be some point that we're going to, it's going to peak and then we're going to have, you know, a slide down for a couple of years. And like, like we always do in every cycle.
Right.
But the beautiful thing about that is this, is that when this occurs, We're at a place right now in the real estate market that it's a buyer's market. And so buyers hold the power, the negotiation power, and so they can get great prices. So if we accompany a high Bitcoin price with a low real estate market, when that price starts dipping down, they can transfer those funds and those earnings into real estate and hold it into real estate at a good price until the next Wow.
That's a really interesting strategy. I like that. And we're just coming up to the point in the market where that really makes sense, right? Where people want to kind of put their profits into something or just, yeah, like diversify a little bit. That really makes sense. And it's so cool to see and just think about that is actually an option now in a compliant way, right? You get it. This is wild. So, I mean, I haven't seen any company doing anything like this. So that Bitcoin-backed loan, that transaction just happened. You guys have a lot of traction now on Propy. I know you just got a new listing, by the way. We did. So it's becoming more and more accessible. Where did you get the listing? Oh, BitMart, I believe it was.
BitMart.
Yes, that's right.
Thank you.
I saw that in the news. Um, I, I saw it this morning. I'm literally, every time I open my, my phone, it's like something new about Propeller.
Yeah.
Uh, so you guys are constantly building, innovating, just getting out there in such a big way and being, becoming more accessible to more parts of the world, which is very cool for me. I'm based in Spain, but, um, actually I was just in New York at the Gracie Mansion for the Crypto Summit. Wow. First of its kind. Right. Right. First ever done. And obviously, um, Mayor Eric Adams is a huge advocate for Bitcoin. He was, uh, the first mayor to accept his first 3 checks in Bitcoin. So very excited. And that roundtable conference was designed to sort of talk about ideas that the city could implement as he wants to make it the crypto capital of the world.
Mastermind.
Yeah.
Yeah.
The crypto capital city. So now we're going more, yeah, it was a mastermind and I talked to them about Propy and they absolutely loved the concept of bringing real estate on chain. I mean, like, that was one of the topics that we discussed that was like, this is what makes most sense right now. We're talking about practical applications that really help people. So what are the benefits of, of doing this?
Yes, this is my passion project. I, I am obsessed with deeds on, on-chain because it just makes sense. You know, it's just one of those things that just makes sense. Um, there are over 3,500 counties in the United States. There are over 3,500 different ways that counties record deeds. It's, it's, it's archaic. It's madness out there. I was speaking with some representatives of Iowa and they're interested in, you know, possibly, you know, what does that look like if we put deeds on chain?
Right.
And so a lot of them, their counties are still pushing paper, right? There's actual paper deeds on the county level.
It can't be.
Okay. Which is wild to me. Because I mean, I, I think it's wild cuz the city that I live in, St. Pete, Florida, in the 1920, 1920, I, the courthouse burned down.
Right.
So there's not a record of a house being older than 1920 in all of St. Pete.
Oh my God.
Even though there was houses that was built in the 1800s, it's pretty wild. But there's still places today that are doing paper as deeds.
So I can't be, can't be.
It's wild.
Can't be true.
So here's the beauty is that If deeds were recorded on-chain, one, we could create a universal system that all deeds could be recorded on-chain, right, going forward, and that all counties record the same exact way, which means that all deeds could easily be found, easily seen. We can easily see who the last owner is, and because it's on-chain, it's immutable, right? So we know that that's the true ownership of that property.
Right.
Which means that there would be no reason to have to actually look in the past 50 years to see the trail of ownership, to make sure that the person that is buying the house truly has the ability to buy the house and will own the house.
Right.
And the seller has the authority to sell the house.
Right.
So what we're looking at doing is we're looking at getting rid of an expensive insurance policy called title insurance.
Right.
Right? that has less than a 3% claim rate anyway. It's a multi-billion dollar industry. And to me, to us, it's unnecessary. And so blockchain, putting deeds on chain gets rid of all of that, adds liquidity into the market and, and just makes everything more efficient.
Wow. That was a really powerful explanation. And, and it just kind of hits me hard, like all of these solutions, they're not only making life easier and more seamless, but they're saving a lot of money. Like, we just had Zyphon, who, you know, we discussed earlier. They're a decentralized identity KYC protocol, and they're saving people money because they don't have to deal with the data and then the insurance for the storage of the data.
Right.
Now, you guys are saying that title insurance is a multi-billion-dollar business. Whoa, that's crazy, right? And you can just eliminate that step by putting this on-chain.
