"Ultimately, the cryptocurrency may be liquidated if the collateral value falls below a certain threshold, such as 35% of the property value,” said the report.
Investment banking giant Citigroup has released research on how property technology could affect the housing market, mentioning virtual estate in the metaverse and cryptocurrency-backed mortgages.In a report released Wednesday titled, “Home of the Future: PropTech — Towards a Frictionless Housing Market?” Citi said crypto, blockchain and property in the metaverse had the “potential to transform the traditional real estate market.” While crypto-backed mortgages could streamline the process of purchasing a home, many individuals have seen investments in metaverse property grow in the last two years.Citi reported that property loans linked to crypto assets could allow investors to “utilize their investment gains” without incurring capital gains taxes, but commented on the potential for risk in a volatile market.