It is well known that – depending on the use case – cryptocurrency is making some headway in mainstream commerce. On the retail side, we’ve seen announcements from companies like PayPal and Tesla that they have added – or will contribute – Bitcoin adoption to the mix.
PayPal, for example, said that cryptocurrency could be spent around the world with tens of millions of merchants.
And starting this week, we are seeing signs that Bitcoin will be accepted, at least in some quarters, for payments related to some of the most expensive items, namely mortgages.
According to media reports including CoinDesk, United Wholesale Mortgage will aim to accept cryptocurrency for payments, aiming to implement this feature by the end of the year. During a conference call with analysts discussing Q2 results, management announced that the company will be the first mortgage lender in the country to accept cryptocurrency for mortgage payments.
Walk before running
Separately in an interview with the publication Detroit Free Press, GENERAL DIRECTOR Mat Ishbia gave a little more details on the roadmap that might be ahead. “I think we’re starting with bitcoin, but we’re looking at Ethereum and others,” Ishbia said. “We’re going to walk before we run … that’s the plan. Obviously, there are no guarantees – we are still working on some details. “
The plans were announced during the quarter when the company had $ 59.2 billion in mortgages.
The mechanics of paying mortgage payments in bitcoins have yet to be revealed. Will it be a process whereby bitcoin is converted to fiat, which is then used to make a payment? Is there an option to choose whether to execute a transaction / payment using traditional bank accounts for one month and then revert to a Bitcoin payment the next month? Will a mortgage lender keep Bitcoin on their balance sheet if the transaction is done directly in that cryptocurrency? All of these questions, of course, have to do with how stakeholders will take into account the inherent volatility of cryptocurrencies themselves – how they affect the cost of the transaction and the impact on the lender’s balance.
At least there is a precedent for using cryptocurrency in mortgage activities. As reported earlier this month, Partido Popular (PP), a political party in Spain, introduced a bill that would, among other things, allow consumers to pay their mortgages using cryptocurrency. In addition, investors will be able to use cryptocurrency when investing in mortgage pools.
The reports are coming in as consumers increasingly seek to use cryptocurrency in their day to day expenses. About 60 percent of consumers recently surveyed by PYMNTS want to shop using cryptocurrencies, and more than half of the respondents would like to use digital offers to make large purchases rather than just cash out their assets.