Bitcoin for Real Estate? A Major Japanese Company is Betting on It
Crypto Reshapes Real Estate Markets: Revolution or Fad?
This report was written by Tiger Research, analyzing Open House Group's adoption of Bitcoin and Ethereum payments for the real estate market.
TL;DR
Open House Group, a major Japanese real estate developer, now accepts Bitcoin and Ethereum as payment methods. This marks a significant shift in Japan's real estate industry.
The Japanese real estate market attracts global investors due to its stable returns. Cryptocurrency payments simplify cross-border transactions. Foreign investors can now invest faster and at lower costs. This expands market opportunities.
This spreading trend will accelerate transactions and reduce dependence on traditional finance. Cryptocurrency payments will also gain momentum in other high-value asset markets like yachts and artwork.
1. Introduction: A Major Player Enters Crypto Real Estate
Open House Group, a major Japanese real estate developer, recently introduced Bitcoin and Ethereum as payment methods for property purchases. This marks the first such initiative among major Asian real estate companies, signaling important potential for cryptocurrency use in property transactions. Currently, this service is limited to income-producing properties, but plans exist to expand to other property types in the future.
Real estate is a prime example of an illiquid asset. Owners find it difficult to convert properties to cash quickly or find suitable transaction partners. Cryptocurrency payments diversify payment options and enhance transaction convenience. They also reduce cross-border fund transfer burdens. These benefits lower entry barriers for foreign investors. This development will likely become a significant turning point. It will complement real estate's illiquidity and improve market efficiency.
2. Why Now? Timing and Market Conditions
2.1. Bitcoin’s Legitimacy and Global Crypto Real Estate Adoption
Bitcoin has gained prominence following US ETF approval and increased institutional investor participation. This has established it as a store of value while improving liquidity and stability through mainstream integration. In 2024, Bitcoin transaction volume exceeded $19 trillion - an all-time high and more than double the previous year's figure. This growth increases Bitcoin's potential use in high-value asset transactions like real estate, expanding its influence in physical asset markets.
Property transactions using Bitcoin are already occurring globally. In Miami, cryptocurrency property purchases are rapidly increasing, with blockchain-based platform Propy facilitating Florida's first cryptocurrency real estate sale. Similarly, global real estate group TEKCE, operating in five countries including Dubai, Spain, and Turkey, is expanding cryptocurrency applications by brokering Bitcoin property purchases.
2.2. Japan’s Real Estate Market Appeal
Japan's real estate market attracts foreign investors with its stability, liquidity, and low-interest environment. The market offers relatively low entry barriers with mortgage loan-to-value (LTV) ratios of 70-80% and interest rates around 1%. The yen's low value further enhances investment appeal.
According to NLI Research, average housing prices in Tokyo's 23 wards have steadily increased during the low-interest-rate period. This demonstrates how low borrowing costs simultaneously drive real estate demand and improve investment returns. With average rental yields reaching 4.2% in Q1 2025, the market is particularly attractive to foreign investors seeking rental income. Japan's real estate market continues to appeal to investors pursuing both stability and profitability.
3. Innovation in Real Estate: Opportunities from Crypto Payments
Cryptocurrency payments in real estate markets open various possibilities. Crypto investors can now buy real-world assets directly with their cryptocurrencies without complex off-ramp processes. This offers portfolio diversification for those seeking stable investments against cryptocurrency volatility. Japanese real estate, with its steady returns, can become an attractive option for risk diversification.
Web3 companies can convert their cryptocurrencies into real estate assets to increase financial stability. Foreign investors facing difficult overseas remittances or strict capital controls gain enhanced access. They can invest directly in real estate through cryptocurrency, reducing high fees associated with currency exchange.
Open House Group may expand beyond diversifying payment methods for new customers. The company could build "Bitcoin reserves" by converting some funds to Bitcoin like Metaplanet did. This strategy would diversify their financial portfolio and drive stock price growth. Metaplanet's stock price increased rapidly after their Bitcoin purchase. Investors viewed this as strengthening "future competitiveness." Open House Group could expect similar market reactions by adopting this strategy.
4. Challenges to Traditional Finance and Cryptocurrency Volatility Risks
Cryptocurrencies are emerging as new payment methods for real estate transactions. This trend raises concerns about threats to traditional financial institutions' revenue structures. Banks may lose core income sources like remittance fees, foreign exchange fees, and mortgage loans. Their influence in real estate finance could shrink. Decentralized lending models, especially asset-backed stablecoins, could further weaken traditional finance's dominance if they surge in popularity.
Regulatory bodies and tax authorities now face new challenges as cryptocurrency payments expand. Tax officials struggle to track fund flows when foreign investors purchase real estate with cryptocurrencies. This situation creates urgent needs for tax and regulatory responses. Japan and other countries must continuously develop taxation systems and regulatory frameworks for cryptocurrency transactions to address these changes.
Bitcoin shows higher volatility compared to traditional assets. Real estate prices linked directly to Bitcoin or Ethereum can fluctuate significantly even within short periods. Developers can prevent this by setting property prices in stablecoins. Buyers paying with BTC or ETH would convert to stablecoins during transactions. Sellers can also reduce volatility risk by immediately off-ramping to fiat currency after payment. Both parties should consider hedging strategies through derivatives to minimize volatility risks.
5. The Bigger Picture: Is This a Trend or a One-Off?
Open House Group has actively explored blockchain technology applications since 2022, including supporting Bitcoin Lightning Network research. This suggests a long-term strategy beyond simple payments, considering broader applications like property ownership, smart contracts, and DeFi integration. The market already operates tokenized property ownership pilots. This movement could pioneer new models for Japanese real estate sales when fully implemented.
If Open House Group sees global investor demand through cryptocurrency payment adoption, real estate companies worldwide might follow suit. Applying cryptocurrency and blockchain technology to ownership records and other areas will improve transaction efficiency and transparency. This will also promote integration with various financial solutions.
Singapore and Hong Kong companies already actively attempt real estate tokenization in the PropTech sector. For example, Singapore startup Fraxtor has expanded property tokenization efforts by dual-listing real estate-backed tokens in Singapore and Australia. This case demonstrates the high likelihood of more diverse digital asset connection models in real estate.
Whether this trend becomes temporary or establishes itself as a global trend remains unclear. However, cryptocurrency-based transactions continue to appear in places like Dubai, where some property developers have accepted Bitcoin as payment since 2017. Many watch closely to see if Japan's initiative will create similar ripple effects in other Asian countries and accelerate blockchain-based real estate market innovation.
6. Conclusion: Beyond Payments, a Structural Shift?
Open House Group's cryptocurrency payment adoption signals the start of broader changes in real estate financial infrastructure, beyond just adding a payment method. Real estate transactions remain sensitive, with challenges including cryptocurrency volatility and inadequate regulations. Despite these challenges, potential benefits like simplified transaction procedures, expanded liquidity, and global investor attraction deserve attention.
If this strategy succeeds, effects will likely spread throughout the real estate market. Cryptocurrency payments might also expand to high-value asset markets like yachts, private jets, and artwork. This suggests cryptocurrencies can establish themselves as actual financial and asset management mechanisms beyond speculation tools. The speed and depth of integration with existing systems will ultimately determine success.
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