Bitcoin: New Yorker pays $18,000 rent using the cryptocurrency

Posted by Rapti Gupta on Apr 07, 2014 12:46 PM EDT

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Nick Spanos, founder and realtor of property firm "Bapple," recently accepted rent for a NoLita, Manhattan, apartment in Bitcoin, making it the first U.S. real estate transaction done with the cryptocurrency, according to several news reports.

Spanos revealed that on March 24, a tenant deposited $18,000 in rent to an unidentified landlord in hard cold Bitcoin. The lease of the residence started April 1.

The deal was conducted by Bapple broker Jeff Goolsby, who told Crain's New York that the tenant saved a lot of money opting for a Bitcoin transaction by saving on the certified checks and wire transferring costs.

Spanos notes that Bitcoins can be a lot safer than other electronic payment methods like credit and debit cards, if managed properly.

Indeed, Bitcoin has been garnering a lot of attention from the real estate segment of late. More recently, Bond New York, a popular listing agency in New York City, announced that it will be accepting the digital currency, reports The Real Deal. A Hamptons home is also listed for Bitcoins worth $799,000.

In March, a villa in Bali also sold for 800 Bitcoins, the equivalent of $500,000, making it the most expensive property ever dealt in Bitcoin.

"As long as they can quickly and efficiently accept payments and exchange them back for dollars, [companies] are willing to do it. It's a way for them to reduce their transaction cost," William Norton of law firm Baker Donelson Bearman Caldwell & Berkowitz told Law360.com.

Recently, the U.S. Internal revenue Service announced that Bitcoins will be taxable in the country and will be treated as "property" rather than a "currency."

First introduced in 2009, the digital currency requires people to solve a certain set of complex puzzles and programs to earn Bitcoins. The Bitcoins can be stored in online digital wallets (accounts) and can be transferred to another person's wallet. However, it gained notoriety for not having any government control and being utilized by users of the Silk Road, the online black market for illegal trade.

However, some believe that Bitcoins could revolutionize currency and give a good boost to the economy.

"Bitcoin has the potential to globally raise the standard of living if Washington doesn't over regulate it. Criminals that have used Bitcoin for illegal activities in conjunction with a lack of industry representation in the media and Washington, have caused a failure in recognizing the benefits of Bitcoin," Perianne Boring wrote for Forbes.