Can you buy a house in Marbella with Bitcoins?22 Feb 2018 | News and Updates
The answer to whether you can buy a property in Marbella using Bitcoins, isn’t straightforward. In this article, we’ll clarify a few points and then answer the question. Let’s start at the beginning. (Benarroch real estate does not accept payments with any cryptocurrency for now).
What is Bitcoin?
Bitcoin is a digital currency that can be traced back to 2009, when it was developed by Satoshi Nakamoto. Put simply, it’s a currency that’s generated or that comes into being as the result of solving extremely complex mathematical calculations (in an activity known as mining). This is performed by independent nodes spread all over the world, which weave what is known as a blockchain network. Every time one of the nodes resolves one of these mathematical calculations, the result is that a certain number of Bitcoins are obtained and put into circulation.
This is therefore a completely decentralised virtual currency with the ability to offer its users all the necessary security to enable it to be used as an exchange currency. One of the reasons why it’s so secure is because the blockchain is unchanging and unalterable. It’s a database that, in theory, allows data to be entered, but not altered. According to the creator, to be able to make alterations, a 51% share of the network would have to be exceeded, which means a majority of nodes taking control. In simple terms, to be able to falsify data, more than 51% of the nodes would have to act jointly. This is difficult to do in practice, and several attacks have been recorded since the creation of Bitcoin, where a 51% network share has been achieved.
It’s also important to highlight that this is a deflationary currency, with just 21 million Bitcoins existing worldwide. Once all of them have been mined, there will be no way of finding any more. So, it’s similar to gold and other finite materials on our planet, which is the basis for using the term mining. This is one of the main reasons its advocates give for the growing market value that this currency has enjoyed since its creation.
Are we ready to buy properties with Bitcoins in Marbella?
Even though it’s been a legal payment method in Spain since 2015, it isn’t currently possible to buy a house in Marbella and pay exclusively with Bitcoins. The transaction to buy a property in Marbella, or anywhere else in Spain, has to take place in euros, which is the only legal tender in Spain. It is, however, possible to value the property in Bitcoins and for the seller to apply the current euro exchange rate at the time of sale, and receive the equivalent amount from the buyer in Bitcoins. The tax due as a result of selling the real estate will be the usual amount for these cases and, of course, the buyer must declare any profit or loss that the conversion from Bitcoins to euros has generated for them, on their annual income-tax declaration.
At present, technology is being developed at an elevated rate, which makes it difficult for the government to stay on top of its tax legislation. This means that amendments are continual and complex. In this article, Trecet (2017) explains how to pay income tax on Bitcoins in Spain.
To sum up, it’s important to underline that cryptocurrencies are probably here to stay, though they’re still taking shape and being integrated into the traditional economy. I personally think that there is a current fashion for trying to buy products and services using this volatile currency with its bullish tendencies. Selling off this type of financial product doesn’t make much sense at the moment. But, despite this, it seems people are using it to make payments. This would appear to be more beneficial for the receiver than the payer, at least for now. Time will tell.
Trecet, J. T. (2017, 20 September). Cómo Tributan los Bitcoins en la Renta. Retrieved 20 February 2018 from: http://www.bolsamania.com/declaracion-impuestos-renta/como-tributan-los-bitcoins-en-la-renta/.
¿Qué Es la Cadena de Bloques (Blockchain)? (n.d.). Retrieved 20 February 2018 from: https://blog.bit2me.com/es/que-es-cadena-de-bloques-blockchain/.
Article by Brice Benarroch Mennessons22 Feb 2018