Chinese Millionaires Using BTC to Buy Real Estate
Early Bitcoin adopters from China who have now become millionaires and billionaires are funneling some of their wealth out of their country by investing in real estate in other countries.
Diversifying Investments
Since Chinese regulators clamped down on the cryptocurrency industry in China last year, people who made their millions through cryptocurrencies are now turning to real estate markets across the world so that they can diversify their holdings.
Some of these newly made millionaires buy their properties directly with BTC, while others are converting their cryptos in the fiat currencies without going through a bank.
According one of the crypto based real estate start up founders, who was willing to speak only on condition of anonymity, about a third of their prospective clients are from Asia. Of this demographic, a large number are from China – investors working through Hong Kong securities brokers to buy up tokenized properties.
The number of investments being made by Chinese mainlanders in foreign real estate through Hong Kong brokers has been surging in recent times. This is because property bought through Hong Kong doesn’t need the same paperwork as well as taxation that is needed for foreign investments being made directly in other countries.
According to the CEO of crypto-based real estate agency Propy, Natalia Karayaneva, the number of people willing to buy real estate using cryptocurrencies has been significantly growing.
She said this is because it is much easier to get money out of China using Bitcoin, rather than going the traditional route of opening a bank account in Hong Kong and then using business channels to get their money out.
Most Popular Locations and Properties
Karayaneva says that the two most popular locations for real estate purchases by these Chinese crypto millionaires are the United States and the United Kingdom. And within these two cities, financial and technology hubs like London and Silicon Valley are their favorites. The third favorite location for these millionaires is near Ivy League schools.
Karayaneva stated that currently, more than 50% of the traffic on their website comes from China, with the mainlanders chalking up more than 50,000 views per month.
And according to California-based real-estate middleman startup SetSchedule’s CEO, Roy Dekel, it’s become more and more common for Chinese BTC early adopters to convert their cryptos into cash to buy property, rather than buying directly with BTC.
It is not just the Chinese who are buying real estate using cryptocurrencies. Europeans are also using BTC to buy luxury apartments in Dubai, for example. However, because of the fact that the Chinese real estate market is so restricted, the people actively invest in properties abroad.