​While the need for regulatory oversight for the lucrative cryptocurrency trade between big enterprises and investors is a source of debate, a few small businesses, such as restaurant chains and online stores have already begun accepting payments in these virtual currencies.

Quorum Holdings is conducting a first-of-its-kind trial of this new business model for Forest Views, a residential property in Johannesburg, by collecting bitcoin rental deposits from tenants. The company announced this week that it is assessing the payment method at Forest Views, one of its latest developments in Bramley.

Although rental deposits are standard practice in South Africa, in most cases, tenants do not normally benefit from the money being held by their landlords and deposits can be held for the duration of the lease.

Quorum Holdings’ lawyer, Saul Mayers, says this innovative option for rental deposits represents a new way of doing business.

“We are excited about trialling rental deposits in crypto for our latest development in Johannesburg, Forest Views. Depending on how it works, we will expand to other properties in both Joburg and Cape Town,” says Mayers.

“Our typical tenants are young professionals who are familiar with crypto and may want to use theirs as a deposit instead of the standard deposit practice,” he adds.

The use of cryptocurrency to secure property leases is a form of assurance for tenants as they will be kept in the loop about where the coins are being held – on South Africa’s largest cryptocurrency exchange, Luno.

“Tenants may use bitcoin or Ethereum to secure their leases, knowing that their crypto will also be held on a safe, trusted platform. The risks associated with the price volatility of crypto are still there, but all gains are for the tenant when they leave the development, with the property owner being prepared to shoulder any possible losses,” Mayers explains.

Marius Reitz, the General Manager of Luno for Africa says Quorum Holdings’ decision to offer tenants the option to pay their rental deposits in crypto will benefit them immensely.

“Bitcoin was developed as a medium of exchange. As cryptocurrencies become more mainstream, we expect to see increased adoption,” says Reitz.

There is an increase in the number of people trading in Bitcoin and Ethereum, but only a few institutional investors have shown interest, including Tesla and MicroStrategy.

“We pride ourselves on our ability to be flexible, innovative and create a new normal. Not only does this allow us to improve existing assets, but also to develop high-yielding assets in niche markets,” says Brad Bentz, the Financial Director at Quorum Holdings.

The brand-new residential building, Forest Views, has sun-facing garden units from just R5 350/pm, inclusive of uncapped free Wi-Fi, an outdoor gym, a braai area, a kids’ play area, a Laundromat, prepaid electricity, and exceptional security. The apartments have one or two bedrooms, a bathroom, and a lounge. The tenant deposit, which is one month’s rent, may be paid in Rand or cryptocurrency and the first two months are rent-free.