Rick Caruso’s legendary real estate company is getting into the cryptocurrency game, announcing on Wednesday that it will accept bitcoin as a form of rent payment at its residential and commercial properties.
The privately held company also announced that it has invested a portion of its corporate treasury in bitcoin and formed a relationship with Gemini, the cryptocurrency exchange and custodian established by Tyler Winklevoss.
“Cryptocurrency, we say, is here to stay. We believe bitcoin is the right investment for us,” Caruso said “We’ve put a portion of what might have gone into the financial markets into bitcoin.”
The steps by Caruso’s Los Angeles-based firm mark the new institutional acceptance of bitcoin, which is seen as one factor contributing to the world’s largest cryptocurrency’s recent price increase. According to Coinbase, bitcoin was trading just below $56,000 per coin on Wednesday, up from about $11,000 in early October.
Bitcoin in Business
Tesla purchased bitcoin with cash on its balance sheet earlier this year, and the Elon Musk-led company subsequently started accepting bitcoin as payment for its electric vehicles. Square, founded by Jack Dorsey, has also purchased bitcoin for its corporate treasury.
Wall Street businesses have been moving as well. Morgan Stanley was the first major U.S. bank to announce that its wealth management clients would have access to bitcoin funds. Goldman Sachs’ private wealth management division is expected to begin offering bitcoin and other digital asset investment vehicles to its clients shortly.
Outdoor malls The Grove in Los Angeles and The Americana at Brand in Glendale, California are among Caruso’s properties. Luxury apartments at Americana are also available.
Although customers will ultimately resume behaviors that were put on hold during the Covid outbreak, Caruso told that the health crisis will force some profound behavioral changes. “The businesses that earn their loyalty will be the ones that predict the changes and meet the customer where they are, and Gemini is assisting us with that,” he said.
“Cryptocurrency would be a part of every 21st-century retail and real estate experience,” Winklevoss, who appeared on “Power Lunch” with Caruso, said. Winklevoss and his twin brother, Cameron, are well-known early crypto investors who are bullish on bitcoin in the long run.
Caruso mentioned one scenario in which he sees blockchain and the company’s customer incentives playing out.
“You can receive coin as part of our loyalty scheme, which I foresee in collaboration with Gemini and the Winklevosses. You will be rewarded with a cryptocurrency “Caruso remarked. “You can then invest the cryptocurrency on our assets using the blockchain. Please check into our hotel. Pay the rent if you live with us. This whole ecosystem is created by us.“
Future of Bitcoin
Bitcoin’s current price, as well as its value as a means of exchange, have been challenged by some critics. Using bitcoin to make transactions has tax consequences due to its classification by the Internal Revenue Service.
Caruso explained that his company’s expansion into cryptocurrency is part of a long-term strategy. He said, “It’s not about the next year or five years.“ “We’re excited about the next ten years.”