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Investing In Real Estate Vs. Investing In Crypto

Given a choice between these two, which investment option should you choose? That's what we aim to explore in this article.

crypto vs real estate investing

Given a choice between these two, which investment option should you choose?

To the left is a traditional heavyweight champion, one that billionaire Andrew Carnegie claimed helped 90% of millionaires create their wealth—real estate.

To the right is the new kid on the block, an overnight sensation, currently experiencing a few teething problems but with a market value hovering around the $1 trillion mark—cryptocurrency. So, which one should you settle on? In this article, we discussing the pros and cons of each in great detail. Keep reading to learn more about which investment option is best for you.

Investing in Cryptocurrency

Cryptocurrency is a digital or virtual currency that uses cryptography to secure transactions and verify the transfer of assets. It’s decentralized, meaning no central bank or government controls its flow like traditional currencies.

Since it’s digital, it exists as a string of numbers on a computer hard drive or as an electronic file stored on the cloud, instead of a physical form, like money or gold. This makes it easier to store, send and receive cryptocurrency worldwide.

Crypto Pros

Some of the advantages of investing in cryptocurrency are:

Volatility can produce high returns

Most crypto experience a lot of volatility, which can be a good thing. The sudden price changes mean a crypto token’s price can skyrocket, massively increasing your investment’s value.

Another advantage of these high volatility rates is that it creates headlines. That motivates investors into entering the crypto world, which only adds fuel to the fire, increasing your investment’s worth further.

Benefits of DeFi

Decentralized Finance, or Defi, is the financial applications and tools built on the disseminated crypto networks. In simple terms, these financial systems allow you to transact with complete confidentiality, without interference from external forces.

Various DeFi protocols are available, but you can classify them into two categories: lending and borrowing. The use of these decentralized finance options is beneficial in multiple ways, such as:

  • Not limited to geographical locations.
  • You have complete control of the funds.
  • It provides the highest levels of security because of its unchangeable transactions.

High liquidity

Crypto coins usually have high liquidity because of their high demand, ensuring high trading volume. The high liquidity of cryptocurrencies gives them an upper hand over other market assets. You can sell and buy orders quickly and more efficiently.

And since there are many market players, you can quickly end or enter another deal. A thriving cryptocurrency market enables people to trade with fairer and better prices.

Crypto cons

Investing in cryptocurrencies also has some demerits:

Volatility can also obliterate investments overnight

Cryptocurrency’s high volatility can be a drawback for digital currency. Prices can rise and fall. When they fall, the value of your investment follows suit.

Moreover, a fall in prices leads to panicked investors. Some will look to offload their tokens, further depreciating the coins’ value.

Downsides of DeFi

Although it offers inexplicable advantages, DeFi also faces problems and risks related to blockchain technology. Some of the disadvantages of DeFi include the following:

  • Scalability problems: When there is congestion, it either takes too long to confirm a transaction or becomes too expensive.
  • Lack of insurance: There’s no way of tracing transactions, which increases the risk of losing money due to fraudulent activities.
  • Low Interoperability: Because each blockchain has a different DeFi ecosystem, interactions and carrying out some projects between the blockchains is impossible.

Investing in Real Estate

Real estate investment refers to property buying, selling, and renting. Something to understand about real estate is that it’s an asset class, as it’s a physical item you own and can sell at any time. If there is a down market, you’ll still have your investment intact.

Real Estate Investment Pros

Some of the benefits associated with real estate investment include:

Predictable returns based on historical data

Investing in real estate offers more predictable returns when compared to other forms of investments. You can predict the cash flows of real estate with a high degree of certainty because the growth of rental pricing is anticipatable.

Historically proven to be the best investment asset class in the US

Investing in real estate is nothing new. It has been the investment choice of wealthy individuals because of its tried-and-tested record of positive results. According to a report, the average 25-year return for commercial real estate in the private sector outperformed the S&P 500 index at 10.3%.

Even today, real estate is proving its staying power, with millionaires giving it wholesome approval. Some of the reasons to invest in real estate include:

  • Earns income all year round: this is the case when you are in it for long-term investment rather than getting quick returns.
  • Has a six-figure tax break: Investing in real estate comes with incredible benefits, such as those related to taxes, where, in some instances, it relieves you from paying taxes for the gains you get from your investment properties.

Real Investment Cons

Some of the drawbacks of investing in real estate include the following:

High barriers to entry

Real estate has a high barrier to entry as property is expensive. The housing market, for instance, is dealing with historically high property prices, which are out of reach for potential first-time investors.

Some measures have helped reduce the high barrier of entry, such as real estate investment trusts (REITs). Still, investing in these is not that cheap, and REITs typically offer low yields of less than 5%.

Low liquidity

Real estate is a tangible asset which means it is relatively illiquid. For some, the only way to cash out on real estate quickly is to sell the asset below market price. Otherwise, it could take months before you sell a property, especially in a down market.

So, you’ve probably decided which investment route you’ll choose but hang on a minute. What if I told you that you could invest in both real estate and crypto simultaneously and enjoy all the benefits of both but none of the drawbacks? That’s coming up next.

Investing with United States Property Coin (USPC)

USPC is a form of cryptocurrency token backed by real estate, allowing you to own a real estate asset through fractional ownership.

USPC Pros

USPC comes with various inherent advantages over investing in real estate or cryptocurrency:

Low barrier to entry

According to a report, more than 80% of the population claim that investing in real estate is advantageous, but only 3% of the global population invests in it. The high barrier to entry is a common drawback in real estate investment.

That’s where the USPC token comes in handy, as it has put measures to minimize this barrier, namely, fractional ownership. USPC has helped reduce upfront investment costs, which usually result in a high barrier to entry in traditional real estate investments.

Unlike traditional real estate investments where you must purchase the entire asset, USPC allows you to buy a portion of the property. That reduces the cost of investing in real estate, increasing accessibility of real estate investing to more entrepreneurs.

Fully-regulated cryptocurrency

Unlike contemporary cryptocurrencies that are not regulated by any financial institutions and take too many risks with token holders’ collective value, USPC is a security token. As such, offerings of USPC must comply with all federal securities laws and regulations.

Real estate developments, management, and selling processes are all regulated transactions. And, because USPC is tied to an underlying portfolio of real estate properties, the value of USPC is, therefor, indirectly subject to those regulations. This degree of regulation will benefit investors in the long-run, as it will provide a secure and transparent token.

High liquidity

Trading and investing in traditional real estate properties is usually challenging because of the properties’ low liquidity. However, investing with USPC makes selling and buying real estate property faster because it allows you to enjoy liquidity for your property without necessarily selling it.

For example, a typical real estate transaction can take months, years, and sometimes, decades to finalize. But with USPC, an investor could complete a transaction within minutes because the token utilizes blockchain technology.

Since USPC token holders only own a piece of the property (which is cheaper) and hold the rights in digital form, they can sell that stake online. This process enhances market fairness and democratizes investment in illiquid assets.

In addition, USPC holders who possess a digital record of ownership can sell their property to international markets more easily than if they sold the property through conventional methods.

Hedge against inflation of fiat currency

Since the invention of paper money, cases of inflation have become standard-faire across global economies. In October alone, inflation in the US hit a three-decade high.

Unlike fragile stablecoins pegged to fiat currencies that suffer from inflation, USPC is less susceptible to inflation. This is because the value of USPC is stored in a U.S. real estate portfolio, NOT on the blockchain. Historically speaking, real estate has proved one of the best investment asset classes time and time again, and we believe that creating a cryptocurrency that is tied to this asset class is a no-brainer.

Hedge against the volatility of the crypto market

There’s no doubt that cryptos experience many challenges regarding volatility, which gives USPC an upper hand as it doesn’t suffer from crypto volatility. As mentioned, USPC is a real estate-backed token, a solid asset that rarely suffers from market volatility.

Necessary Disclosures
Informational Purposes for Discussion Only

This general analysis is for general informational purposes only and does not constitute a prospectus, an offer document, an offer of securities, a solicitation for investment, or any offer to sell any product, item, or asset (whether digital or otherwise). The information set out in this general analysis is for community discussion only and is not legally binding.

No Responsibility or Obligation Regarding the Provision or Maintenance of Information

USPC and its affiliated persons and their respective shareholders, members, officers, directors, managers, employees, counsel, advisors, consultants, and agents (“Representatives”) reserve the right, in their sole and absolute discretion with or without notice, to alter any and all of the information of this general analysis.

You acknowledge that: (1) the information contained in this general analysis is subject to change without notice, and no one shall assume from the lack of any updates to this general analysis that the contents of this general analysis have not changed since the date of this general analysis; (2) this general analysis could become outdated due to changing circumstances; and (3) USPC or any of its Representatives does not hereby obligate itself in any manner to periodically or otherwise to update the information in this general analysis or to maintain the availability of any information in this general analysis.

No Advice

Nothing in this general analysis constitutes business, finance, legal, or tax advice. You agree to consult professional advisers before engaging in any activity related to the information provided in this general analysis.

Not an Offer for Any Securities or Investment

This general analysis does not constitute an offer of securities, a prospectus, an offer document, or solicitation for an investment of any kind. Information contained in this general analysis is not an offer to sell securities or the solicitation of an offer to buy securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction.

You acknowledge that: (1) this general analysis and the information shown herein is not an offering of any securities nor a solicitation of an offer to buy any securities and (2) this general analysis and the information herein shall not be construed as any description of the business of USPC or any of its Representatives in conjunction with any offering of securities.

Nothing Legally Binding

This general analysis does not constitute or imply a contract or an offer to enter into a contract. This general analysis is provided solely for informational purposes only and does not constitute any binding commitment by USPC or any of its Representatives. No person is bound to enter into any contract or binding legal commitment in relation to anything in this general analysis.

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Neither USPC or nor any of its Representatives shall be held liable for any use of or reliance on the information described and/or contained on this general analysis. USPC and its Representatives do not and do not purport to make, and hereby disclaims, all representations, warranties or undertaking to any entity or person (including without limitation warranties as to the accuracy, completeness, timeliness, or reliability of the contents of this general analysis, or any other materials published by USPC or its Representatives). To the maximum extent permitted by law, USPC and its Representatives shall not be liable for any indirect, indirect, special, exemplary, incidental, consequential, or other damages or losses of any kind, however caused and on any theory of liability, whether in contract, strict liability, or tort (including, without limitation, any liability arising from default or gross negligence on the part of any of them, or any loss of revenue, income or profits, and loss of use or data) arising in any way from the reading of this general analysis, including but not limited to the reliance upon or the use of the general analysis (including, without limitation, inaccurate information, errors, omissions, outdated data, etc.) or otherwise arising in connection with the same.

No person has been authorized by USPC or any of its Representatives to give any information or make any representation or warranty regarding the subject matter hereof, either express or implied, and, if given or made in this general analysis, in other materials or verbally, such information, representation or warranty cannot and should not be relied upon nor is any representation or warranty made as to the accuracy, content, suitability or completeness of the information, analysis or conclusions or any information furnished in connection herewith contained in this general analysis and it is not to be relied upon as a substitute for independent review of the underlying documents, available due diligence information and such other information as you may deem appropriate or prudent to review. USPC and its Representatives expressly disclaim any and all liability for express or implied representations or warranties that may be contained in, or for omissions from or inaccuracies in, this general analysis or any other oral or written communication transmitted or made available to you.

Any historical information or information based on past performance included herein is for informational purposes only and has inherent limitations and is not intended to be a representation, warranty, or guarantee of future performance. Projected performance data shown constitutes “forward-looking information” which is based on numerous assumptions and is speculative in nature. Actual results may vary significantly from the values and rates of return projected herein.

Your Responsibility to Verify Information

You will have the sole responsibility for verifying the accuracy of all information furnished in this general analysis. There shall be no recourse against USPC and its Representatives in the event of any errors or omissions in the information furnished, the methodology used, the calculations of values or conclusions.

No Affiliation

USPC or its Representatives does not imply any affiliation with, or endorsement by, any third party. Such references in this general analysis are for illustrative purposes only.

Regulatory Approval

No regulatory authority has examined or approved, whether formally or informally, of any of the information set out in this general analysis. No such action or assurance has been or will be taken under the laws, regulatory requirements, or rules of any jurisdiction.

Legal Compliance

You will and shall at your own expense ensure compliance with all laws, regulatory requirements and restrictions applicable to you.

Join The Waitlist

USPC is slated to launch in late March, 2023, and we’re currently building our waiting list for early supporters who want to get in on the action.

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crypto vs real estate investing

USPC Now Live On DigiFinex!

We’re excited to announce that USPC is now live on the DigiFinex exchange. This is an important milestone for USPC as it marks our first listing on any crypto exchange. This also represents a major victory for tokenized real estate, as it demonstrates the potential for decentralized real estate investing!

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