Crypto in Real Estate Finance

The arrival of blockchain technology and digital assets has begun to reshape the landscape of real estate finance. From the tokenization of property interests to the use of cryptocurrencies as down payments, the intersection of these emerging technologies with traditional real estate transactions raises fundamental questions about how existing legal frameworks accommodate innovation. This Article provides the first comprehensive analysis of how cryptocurrency and blockchain technology interact with the law of real estate finance. We examine three primary contexts in which crypto intersects with real estate transactions: first, the use of digital assets as consideration in real property sales; second, the tokenization of real property interests and mortgage-backed securities; and third, the use of cryptocurrencies and other digital assets as collateral for real estate loans. For each context, we analyze how existing real estate finance law applies—including statutes of frauds, recording acts, and the complex web of federal and state mortgage regulations. We demonstrate that while these traditional legal frameworks can accommodate some crypto-related innovations, significant gaps and ambiguities create risks for market participants. The Article reveals particular challenges in reconciling the borderless, instantaneous nature of blockchain transactions with the territorial, recording-based systems that govern real property. We also explore how the volatility of cryptocurrencies affects their use in real estate contexts, examining both the opportunities for new financing structures and the risks to borrowers, lenders, and third parties. Drawing on insights from property law, commercial law, and bankruptcy law, we offer a roadmap for courts, legislators, and private parties navigating this evolving landscape.