Rick Caruso’s real estate company is making a long-term bet on the growth of cryptocurrency. The company announced this week that it will start accepting bitcoin as form of a rent payment at its residential and retail properties.
“We believe that cryptocurrency is here to stay,” Caruso, founder and CEO of Caruso, told CNBC’s “Power Lunch” program. “We believe that bitcoin is the right investment for us. We’ve allocated a percentage of what would normally go into the capital markets into bitcoin.”
The Los Angeles–based, privately held company is both investing in bitcoin and accepting it as a form of payment. It has partnered with Gemini, a cryptocurrency exchange and custodian. Properties under Caruso’s brand include outdoor malls, luxury apartments, mixed-use properties, and more.
In a statement, the firm said that it is committed to bringing decentralized retail payment options to its guests through “uncomplicated, efficient, and safe transactions protected by blockchain technology.”
“I believe bitcoin and cryptocurrency will play an important role in our collective future, and working with Gemini will … add real value to our guest experience,” Caruso said in a statement. “We envision a myriad of opportunities where we can better engage our guests and enhance their experience on properties like introducing blockchain-enabled rewards and enabling cryptocurrency payments. Partnering with Gemini on consumer applications will bring endless options, but we also see a future for how this technology will bring people together.”
Bitcoin has seen surges lately in its trading that have sparked concerns among some critics. It was trading for about $56,000 per coin earlier this week, which is up from around $11,000 in early October, according to Coinbase. In the past 12 months alone, bitcoin has surged more than 600% in value.
Caruso’s real estate firm is part of a growing number of companies that are accepting cryptocurrency as payment, including Tesla, Morgan Stanley, and PayPal, among others.
But as regulations continue to evolve in the space, less than 5% of public companies are likely to invest in bitcoin over the next 12 to 18 months, Daniel Ives, a Wedbush analyst, told Insider. Still, there’s a “growing shift for companies to accept this digital currency as a form of payment,” Wedbush says. “Bitcoin mania is not a fad in our opinion, but rather the start of a new age on the digital currency front.”