Guo Hongcai, a beef salesman from Shanxi province in China later turned to be an early bitcoin adopter. He is one of the many freshly minted millionaires who funnelled parts of their wealth to purchase real estate abroad.
In April, Hongcai sold 500 bitcoins in the U.S., then he used the money in buying a 100,000 square-foot mansion in Los Gatos, which is a 90-minute drive from San Francisco, California. His Rolls-Royce, which he purchased with the fruits of bitcoin arbitrage, beautifully sits in the driveway close to a small chives garden.
The second residence is referred by Guo as his “Mansion of Chives,” because chives, a Chinese slang, is used by crypto investors in proving vulnerability to big sell-offs.
As Chinese regulators secures industry business on the mainland, crypto millionaires are turning to foreign real estate markets in diversifying their holdings. Some purchase properties directly with crypto wherein they use bitcoin to gain foreign currencies without going through a bank.
U.S. crypto real estate startup founders, spoke on condition of anonymity, told CoinDesk roughly that one-third of their prospective users hail from Asia.
Real estates which have been bought in Hong Kong are not being imposed with the same taxes and documentation unlike other financial assets held abroad. Chinese investors who take risks in foreign real estate through Hong Kong brokers have also been rising for years. Now, early bitcoin adopters are utilizing new wealth for known patterns.
It is seen that more and more people are willing to buy properties with cryptocurrencies because it’s getting easier to get their money out of the country with the use of bitcoin rather than establish a bank account and get money out of the country through business channels.
Considering a lot of things, Chinese consumers are hardly the only ones who buy or purchase properties using cryptocurrency. However, Europeans were able to use bitcoin in buying luxury apartments in Dubai’s Aston Crypto Plaza, a project spearheaded by British Baroness Michelle Mone, in 2017.
It is now increasingly becoming clear that crypto wealth creates real impact on global real estate patterns, wherever it’s been taking place.