Introducing BitFlip to Bitcoin Owners

David Fahrney Financial Group announced the opening of BitFlip, a gateway between Real Estate and Bitcoin.

BitFlip offers wealthy Bitcoin Owners opportunities to trade for Real Estate Flips, Holds, and Notes.

Bitcoin Owners seek diversification in their investment portfolio and need access to the wholesale real estate marketplace. Educating real asset owners to value BTC is our primary practice. Educating BTC owners about wholesale real estate brings these worlds together in a global online marketplace.

Our Offer: Marketplace

Bitcoin and Real Estate owners submit summary information about their assets and interests in trading. BitFlip promotes each asset type to the other markets and gathers bids. BitFlip will facilitate negotiating and closing transactions.

We are here to assist and promote the development of a healthy wealthy uncommon marketplace.

David Fahrney Financial Group(DFFG) regularly finances Real Estate Flip Projects, Holdings of Rental Property, and Notes Secured by Flips and Holds with Private Lenders producing uncommon returns on investment.

How to Use BitFlip

BitFlip allows owners of Real and Virtual assets to establish a marketplace to trade them.

If you own Bitcoin and are interested in trading for Real Estate backed assets, click the “List your BTC” link to indicate the amount of BTC that you have and would consider trading, check the boxes to indicate the type of RE Assets that you are interested in at this time, and provide your name and email address.

Only the amount of Bitcoin and the Property Type will display in the public list.

If you own Real Estate Flip Projects, Income Hold Property, or Notes secured by real estate, and are interested in trading some or all of your interest in them for Bitcoin, click the “List your Flip/Hold/Note” link to indicate the property type that that you have, high-level characteristics, and the approximate Annual Return % Offered to Bitcoin owners. Then provide your name and email address.

Neither parties are making a commitment to trade anything via this submission. We are merely providing a common location to post interest in trades. As we see serious submissions that seem like a potential match, we will contact you to understand better your specific situation.

We’ll engage a Bitcoin-friendly real estate broker to facilitate and close transactions.

Redemption

Mike Shedlock offers powerful analysis of global economics.  His recent post is timely and concludes that there is no way out:

http://globaleconomicanalysis.blogspot.com/2014/01/keynes-is-dead-abenomics-fizzles-us.html

What if this assessment is true, including Mish’s disagreement on Japan?

What if we could see that this analysis, while true, is also not all that can be derived?

Have you ever been watching a movie, entranced in the story, and suddenly a gust of wind blows the thin, two dimensional screen? The whole image becomes distorted and you realize that the medium of the story is revealed.

In the real world the screen is ALL of the money systems that are being used to measure these assessments: GDP, debt, income, growth, the economy, exchange rates, costs, etc.  Money is the medium.

So, what’s the alternative? What’s not the common denominator?

Imagine we did not have any of the modern internet now and how our story and assessments would be different. Then imagine that, since the common media of this Global Economic Analysis are the common forms of money, that we could revolutionize the medium, the money.

If the money medium becomes 3-dimensional and dynamic, could the story, assessments, and opportunity change?

Just like transistors reformed electronics, personal computers reformed computing, fiber optics and satellites reformed communications, the global internet reformed human coordination, there may be an equivalent breakthrough in money itself.

“And if you’ve come this far, maybe you’re willing to come a little further.”

Modern cryptocurrency, Bitcoin, offers this new medium.

“Get busy living or get busy dying”. – Shawshank Redemption  http://www.youtube.com/watch?v=7tkzc983aE0

Gox Waves

The Northridge Earthquake in ’94 shook LA up pretty good. One of the most picturesque features was the interruption of major highways. We’d been warned for years that a big one would disrupt transportation–the lifeblood of Southern California

.

This interchange connector collapse resembles the drop of Bitcoin on Mt.Gox on April 10.  It’s been 30 days-and the shock waves are still reverberating. Bitcoin transmits value like a freeway moves people. It also incidentally ‘stores’ quite a few vehicles at peak traffic times. (OK, just call it a parking lot).

The thirty-day peak of $266 and low of $50 have shaken a lot of confidence out of any people that are relatively new to this deal.  Let’s call ‘new’ those that bought in for less than the low of $50 or before March 18. Still not that long ago.

Since that’s when the media seemed to really start arriving on scene, a lot of people only know of Bitcoin since March 2013.

They predominantly bought Bitcoin on Mt.Gox and consequently wired a lot of money to Japan. Since the exchange has been so erratic, like an earthquake, it’s ruptured some connectors.

There’s a lot of money stuck on Gox. And that situation is reverberating throughout the Bitcoin world.

We’ll need to build new exchanges with more distribution and resilience to meet the coming global market.

How to Wire (old) USD

We need to send $100,000 to buy a house, (I do this once a week or so).

1. Get dressed (you’re not going to the bank like that.) 5-15 minutes.
2. Gather your papers and forms for your account. (5 mins)
3. Drive to the bank,  5-15 minutes
4. Wait in line, declining the numerous offers for candy, coffee, water, doughnuts, back rubs.
5. Request a wire transfer form.  See attached.
6. Complete the redundant wire transfer form. (5 mins)
7. Transfer funds from one acct to another. (5 mins)
8. Teller enters same info into computer. (3 mins)
9. Get Senior Banker approval. (2 mins)
10. Be assured that it will be OK, and determine whether the bank should call to confirm it went out. (1 min)
11. Drive home. (5-15 mins)
12. Wait for the wire to go out. This could be 30 minutes later to several hours to 20 hours later if you missed the afternoon cutoff time.
13. Wait for receiving bank to credit recipient’s account. (10 minutes to 4 hours)

How to Buy a House with Bitcoin

Don’t Try this at Home.

I buy a lot of real estate. That’s not entirely true. I pay for a lot of real estate. I leave the buying to people that are much better at finding and negotiating deals. You should too. Why? Because they will get much better prices on better properties to own.

Developing relationships with people that are good at buying, fixing, borrowing (yes), managing, and selling real estate is primarily what I do. If you want to own real estate, you should too.

Actually it is really easy to buy a house, any house. You just have the seller make a Grant Deed to you, and you pay the seller cash. Done. It’s obvious. The hard part is determining what house to buy at what price, and what to do with it afterward to realize a good outcome.

How then do guys like me do it frequently?

Like I said, we develop relationships with good buyers.

And what do the good buyers do? They take time and use skill to develop relationships with potential sellers.

Unless you intend to invest 5 years and 10,000 hours in learning to do all of that (which can be a great career), perhaps you’d consider buying real estate with us.

Buy a house with Bitcoin.

You can buy all or part of a house or a note secured by a house with us. We have a list of people that own houses and notes (some that they are flipping and some holding for rental). Most of these people buy, hold, and sell in much higher volume than the regular person–in range of 1-10 per month.

You don’t have to get it right, you just have to get it going.

When you develop a relationship and work with people that know what they are doing, you can participate in a market and take prudent risks. We’re here to give access to the world of wholesale real estate. That’s what we call it–it’s not retail real estate–that’s for real estate agents to help buy a home to live in (although all of our houses are lived in by someone).

Owning all of part of a note is also a good way to start. You’ll get monthly payments in USD based on your percentage investment in the note.

If you have BTC and want to consider trading for real estate, just List Your BTC. Or Contact Us to learn more.

The Object of Money

Money is a powerful thing. Or is it?

We spend a lot of time and energy in these rooms discussing the nature of money.

The recent boom in value of Bitcoin had large swaths of the world suddenly wondering, “Just what is this thing?” And that is how it is most often referred to, as a thing. We are attempting to be objective and to objectify Bitcoin. It seems obvious to do this. And it lacks integrity.

Bitcoin is just the name for a collection of programs being run on a bunch of computers networked together and operated by a large group of individual people who find it in their interest to work the system together. How is this an object or thing?

It isn’t, but it is Valuable.

We relate to each other’s values by conversing and transacting. Money is a medium for expressing values. Our values are at the center of our relationships with ourselves and others. Then when we ask, “What is the value of Bitcoin?” we are really asking about a relationship. Objectifying and Relating are opposites in how we behave with people, things, actions, and ideas.

As humans, we want to relate to each other. When we relate, we live and love people by appreciating them for being and doing. We care less about what we have and more about who we are with.

Relationships are powerful.

We organize our concerns through relationship. We coordinate, cooperate, lead, follow, share, love, and live in human and spiritual relations.

There is no object of money. It is a means to an end, not the end. Bitcoin, then, doesn’t have value. Rather it is valued and used as a tool to share, exchange, trade, and transact value with people. It is a tool people use to relate.

We create Sovereignty.

Now the importance of who we are relating to becomes apparent. This form of money, like all others, helps communities organize around common values and provides real structure to relationships. Every state has its money. It is a necessary condition for sovereign statehood.

How then is Bitcoin claimed to be money? The new form of state that arises from a new form of money that is not controlled by an existing state—is the act of creating a new state. This circular evolution is the genesis of our Modern State.

We build Integrity.

This outcome is undeniable, though it seems lofty and conflicting. But, if we are to build integrity around our actions, then we must tell the truth. First we must decide to stop pretending. Then we must tell the truth. Then we develop trust in ourselves. And finally we imagine the result of a new form of government that arises from this situation. We imagine that we have just stated a new country with its own sovereignty just by shifting our transaction from one form of money to another.

This is ambitious and powerful—uncommon.

Prior Art

My neighbor, Joe O., piqued my interest in photography in 1977. He had a full darkroom set up in his bathroom and it was amazing that he could take pictures, develop film, and print enlarged images on big sheets of paper. He showed me all of the basics of photography, film speed, aperture, shutter speed, depth of field, time lapse, panorama, etc. I went on to invest most of my meager 12-year-old’s savings in a Canon AT-1.

I took thousands of photographs, spent hundreds of hours in the darkroom, edited three high-school year books, and went on to study photo-science in college. The darkroom enabled learning, creativity, and relationships. We enjoyed the power to control the outcome with our equipment. It was technical art.

And then what happened?

Cheap digital cameras and internet photo sharing completely revolutionized the business. Film-based photography faded, darkrooms disappeared. Power, concentrated in camera, film, and developing companies was distributed to everyone with computers. Kodak, with 90% market share, never saw what hit them. Fotomat? Gone.

New technology offered a massive paradigm shift. People everywhere accepted. Digital photo and video landscapes bloomed–and the cost of taking pictures dropped to almost nothing. Yet the market for photos is larger and healthier than ever.

How is it that lowering the cost on individual transactions results in a healthier, wealthier market?

Bitcoin poses the same question. Technology, capability, and cost starkly contrast fiat paper-based systems vs. pure internet money Bitcoin. Credit and debit cards are like scans of your old photographs, “Yeah, that will do it. That’s all of the technology we need.” Wrong.

Bitcoin presents the same revolutionary improvement that digital photography offered. Coupled with high-speed worldwide internet connectivity and always-on mobile compunications (smart-phones), the paradigm shift is inevitable.

Kodak. Central Banks.

Taking pictures with film. Using paper dollars. There will always be a place in our hearts for sentimental relics.

Saving Modern Money

Type “Hoarding is” into Google and what do you see?

1. Hoarding is a mental illness
2. Hoarding is a disease
3. Hoarding is a sin

The notion of hoarding money, whether it be US$ Cash, Gold, or Bitcoin is powerfully misconstrued to shame wealthy people into ‘sharing’.

This is an uncommon conversation to look into the relationship between wealth and hoarding money. We’ll focus our efforts on hoarding Bitcoin, since it is on many media pundits’ minds.

Is money a store of wealth or a means of trade?

Yes. Money is the capacity to transact. So any store of wealth is a future means of trade. Whether one desires to transact immediately now, soon, next week, month, year, decade, upon death—what does it matter? The continuum of time between now and forever allows us no criteria to judge how soon someone must intend to spend their money.

This is obvious and also will not assuage the zealots against riches.

They will still accuse the wealthy of hoarding. They will say that as long as there is a limited supply of something and you have more than your share, well you are depriving the people that have less of what they might need.

This (il)logical sleight of hand can betray us if we don’t get some notions straight.

If we allow that whether ‘money’ is cash, gold, credit in a bank ledger, or maybe Bitcoin, we will find that we have the same sort of relationship with all four forms of money.

Of these four, only one has physical uses other than monetary uses: gold (unless you are propping up your wobbly table leg with a pile of dollar bills). Easy research will reveal that the vast majority of gold is ‘hoarded’. Oh My! This is mental illness, disease, or a sin!

The point is that anything that is used primarily to store money is considered most useful as money and therefore, no one is deprived of food, shelter, clothing, hygiene, sanitation, medical care, etc. by someone else having some form of money.

So, whether one finds gold, get’s paid in cash by the government, has more credit in their bank ledger, or accepts Bitcoin—none of these acts does anything whatsoever to anyone else on their own.

It is only because other people value these forms of money that they will act to try to get that money and essentially trade their labor, time, goods, and other forms of money for it.

Why should Paul Krugman care if I trade my USD for Bitcoin?

From his point of view, I have just ‘dis-hoarded’ the only form of money that he recognizes as valuable and have given it to someone else! Yeah! He should be cheering. But he is not. Hmmmmmm.

Similarly, Paul is worried that on some foreign currency exchange domiciled in Japan, some people traded in USD for fewer BTC than last week. (The price of BTC rose.) He fails to note that only a tiny fraction of all of the Bitcoin is being traded on these exchanges, so even if he cared at all, it would be invalid to conclude that all people everywhere who ‘own’ Bitcoin also place the same value on BTC vs. USD.

The marginal value of a trade does not determine the value for the whole market.  Even if 100,000 people make the same trade it does not determine the value for all 7 billion inhabitants of the earth. So, this is false, wrong, ineffective, powerless, irrelevant, etc.

The same principle applies to any good, service, or money that is traded. So what are we left with?

Individuals are free to value any two things for whatever they judge is in their best interest. And they may be wrong and who can tell them accurately otherwise?

Hoarding is good for society.

If hoarding is really just a moving target for how long and how much of something that one owns, and they are saving it for the future, what is the illness, sin, or wrong in that? Mr. Krugman must allow that all forms of money can be infinitely divided so that there is never a real shortage of ‘currency’. This applies to gold, USD, credit, and Bitcoin.

In Bitcoin’s case there are presently 1.1036 Quadrillion satoshis in existence or about 157,657 satoshis for every one of the 7 Billion people on planet earth now. For all practical purposes, this should be enough currency to transact for quite some time. And it can be further subdivided if need arises.

So, if something new is created, such as Bitcoin, and it is hoarded, what did it take away from anyone else? Nothing. In fact somebody was given something to get that Bitcoin. This is our answer.

The act of hoarding one form of money takes nothing from all other forms of money and in fact dis-hoards other money, making it more available to spend.

We haven’t solved the conundrum of where the increase in value in Bitcoin comes ‘from’—that seems to bother Keynesians endlessly.

We must also address the reason central banks ‘hoard’ gold while issuing ‘valuable’ fiat currency, and what ‘excess gold reserves’ mean. (hint: similar to excess Bitcoin reserves)

Money at Internet Speed

Time is a primary factor in all of our lives. The speed, cost, and security of moving currency has a significant effect on our whole economy and our wealth.

This is an uncommon conversation to look into the relationship between wealth and three factors that seem to be denominators in the equations about money: how (1) quickly,  (2) inexpensively, and (3) securely it can be moved between parties. Combined, they form an effort factor.

Consumer products retailers have long learned that by offering instant credit and debit systems, their overall sales increase well beyond the cost of those systems. Even when they factor in returns, chargebacks, and fraud they come out ahead. Today’s large credit-based payment systems are built around the huge volumes of effortless transactions that retailers and consumers enjoy.

But what if there was a system that was asset-based, faster, lower cost, fraud-proof, and eliminated chargebacks?

Further, what if the value of the money was deflationary—its value significantly rising in time—to the point that people hoarded it? Would this be good for an economy? For a nation? For the world?

We have to ask: what is a good?

A good lowers cost and increases value to those that use it.

Numerous economists are speaking out about Bitcoin as a ridiculous experiment concocted by internet extremists and individualists who must have ulterior motives and unsocial behaviors. They squawk and snort about all of the fools that are squandering trust in bits of information contrived from nothing. They scoff at the notion that something backed by neither state governments nor solid commodities could be worthy.

They have lost sight of the notion that people value anything that increases their ability, lowers their cost, saves their time, is more secure, preserves privacy, and overall increases their capacity to transact.

Money is the capacity to transact.

In my business as a private lender to Real Estate Rehabbers (some say Flippers), I inevitably spend much of my precious time at the bank. People say that I am ‘banking’ but I say that I am wasting time at the bank trying to transact. (Banking is storing money, not moving it—I need to move it.)

Between cashier’s checks, bank wires, and depositing money directly into customers’ accounts at the same bank, I spend several hours per week driving to/from the bank, filling out forms, providing identification, waiting for approvals, paying fees, being told it will happen tomorrow, and generally being unsatisfied and overcharged.

Banks are mostly oriented around keeping your money, not helping you transact.

The value of Bitcoin is crystal clear. It offers increased speed, lower cost, and high security to transact—and that is money.

While the numbskull economists are busy nay-saying that Bitcoin is not worth the bits it is printed on, I say that the flip side is that it will be adopted by people that value time—and money.

I’ll address ‘hoarding’ in a later post.

FAQ

Q: What exactly are we trading?

A: Bitcoin Owners are trading for Real Estate or Note Interest in US$. They can purchase a whole property or part of a

• Real Estate Rehab Flip Project
• Real Estate Held for income and appreciation
• Note secured by Real Estate.

The RE Owner will receive a one-time payment of BTC and the Bitcoin Owner will receive all of the rights that go with ownership of RE assets (monthly payments and proceeds from sales or payoffs).