Roofstock facilitates sale of property via NFT on a blockchain

Roofstock, a company that sells rental properties, announced the first sale of a single-family property via a non-fungible token, or NFT, on its platform. 

The property, located in South Carolina, was sold to an investor for $176,200 last month on the Ethereum blockchain.

The transaction was enabled by Roofstock onChain, its web3 subsidiary, which gives investors the ability to purchase tokenized rental properties using USD Coin (a digital stablecoin attached to the United States dollar).

Once a property is purchased, the buyer receives a token in their crypto wallet that represents the sole ownership of an LLC that has title to an underlying property.

The transfer of a property happens by way of a contract deployed on the Ethereum network. Properties sold on the marketplace are inspected to ensure that each home is in decent condition and has a clear title, Roofstock's press release said.

Kash Razzaghi, chief revenue officer at Circle, a blockchain-focused financial services company that launched the USD Coin, called this an "exciting milestone for Roofstock." 

"Circle is thrilled to work with Roofstock and bring the benefits of USDC — a more efficient, secure, and transparent method of value exchange over the internet — to the world of real estate," Razzaghi wrote.

Roofstock, launched in 2015, has thus far facilitated over $5 billion worth of real estate transactions. The California-based company said earlier this year that it is in a period of hypergrowth and that traffic on its platform has notably increased. 

In March, Roofstock closed a $240 million Series E equity financing round, bringing the company's valuation to $1.94 billion. SoftBank Vision Fund 2 led the financing with participation from existing and new investors including Khosla Ventures, Lightspeed Venture Partners and Bain Capital Ventures.

"Roofstock has built the modern real estate technology and financial rails to unlock the massive potential of this asset class for investors everywhere," said Gregor Watson, co-founder of Roofstock, in March. "It has expanded beyond a marketplace for trading homes and has become a critical platform for anyone on a journey to generate wealth through real estate."

Cryptocurrency has been met with wariness by some regulators, and its acceptance in the mortgage industry has been slow.

Companies like Moon Mortgage and Miami-based Milo have recently offered crypto-backed mortgage products, but how successful this type of lending product will be remains to be seen.