Propy, an international real estate broker based in Menlo Park, California, has used Ethereum blockchain technology to purchase a $60,000 apartment in Ukraine's capital for TechCrunch founder Michael Arrington, an early backer of the startup, the broker said on September 26.

Propy, which also serves as a decentralised property title registry, said the transaction was settled using "smart contracts" that can be embedded in the Ethereum cryptocurrency and the startup's tokens, according to the  Enterprisetech online outlet.

The startup claims the deal is "the first real asset transfer via blockchain, and open[s] the door for many more remote real estate transactions on the blockchain."

Propy, a global property startup that launched in 2016, had raised $15mn from backers by selling virtual currency tokens, according to the Insider Pro online outlet.

Propy also announced agreements with the government of Ukraine and Chinese real estate company Leju Holdings Limited. The agreements will allow international buyers to purchase public lands in Ukraine and private properties in China through Propy, according to the startup’s statement.

Propy Chief Executive Natalia Karayaneva said that she was thrilled to see her company leading the charge in putting real estate on the blockchain. "Ukrainian real estate is very affordable, and the Ukrainian market will soon be growing dynamically," she said. "This purchase is an important signal to foreign investors, especially Chinese, who face strict capital controls of $50,000 per person, that they can safely and easily invest in this market and, soon in other countries."

Ukraine is a pioneer in using blockchain to register property rights. The Bitfury Group, a global company that is a leader in providing technological solutions based on blockchain, the underlying technology that powers cryptocurrencies like bitcoin, told bne IntelliNews that it’s working with Ukraine for rolling out the first full-scale “Blockchain eGovernance program.” A memorandum was signed by the two sides on April 13 that will look to put a sweeping range of government data and services on blockchain systems.

Ukraine’s justice ministry carried out its first trial auctions using blockchain technology on September 6, as part of an effort to improve transparency in government transactions. 

However, Ukraine's bankers, like their peers in the surrounding countries, remain cautious of cryptocurrencies. 

Oleg Churiy, Deputy Governor of the National Bank of Ukraine, said at teh recent Ukraine Financial Forum in Kyiv that the first question that all world regulators have regarding bitcoin and other cryptocurrencies is, "What is it?" The second question is, "What should I do?" Since most regulators are not able to answer the first question, they don't address the second one.

In Churiy's opinion, bitcoin is a type of payment instrument. Commenting on the status of bitcoin in Ukraine, Oleg Churiy emphasized that the central bank of Ukraine does not recognize bitcoin as a currency because it does not have a central issuer. In this regard, the NBU cannot accept bitcoin as a means of payment in Ukraine. He also added that today, the NBU does not prohibit cryptocurrencies. Their position regarding cryptocurrencies is quite simple-wait and see.