With Chinese regulators clamping down on the cryptocurrency market, crypto millionaires in the country are selling the digital tokens in the U.S. and buying real estate with the proceeds.
According to a report in CoinDesk, Chinese cryptocurrency millionaires are aiming to diversify their wealth and are eyeing real estate outside of China. Some of the purchases are being made directly with crypto, while others are translating the money into foreign currencies. One U.S. crypto real estate startup who did not want to be named in the report told CoinDesk that about one-third of their potential users are from Asia, including Chinese investors seeking tokenized rights to properties via Hong Kong securities brokers. “The requests we have from them start at $50,000 or $100,000 up to, the latest one was $3 to $4 million for Silicon Valley,” Natalia Karayaneva, CEO of Propy, another crypto-powered real estate marketplace, told CoinDesk in the report. “We're seeing 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 using bitcoin, rather than establishing a bank account based in Hong Kong and getting their money out of the country using business channels.” The report noted that the U.S. and U.K. are in hot demand, particularly in FinTech hubs such as the Bay Area of California and London. “They were mostly interested in residential properties next to good education, like Stanford,” Karayaneva said in the report. “Also, they want to diversify. They want to have parts of their assets abroad in more stable countries.”
Meanwhile, Roy Dekel, chief executive of SetSchedule, the California startup that helps real estate agents connect with buyers and sellers, told CoinDesk that Chinese bitcoin investors prefer to convert the cryptocurrency into cash than to purchase real estate properties with the digital coins. He said he has noticed a decline in Chinese interest, but that Los Angeles, San Francisco, and New York remain in demand. “The ultra-wealthy Chinese have used this source as a diversification of investment,” he said. The executive did note that a lot of blockchain enthusiasts are buying investment properties and second homes, which is leading to more sellers willing to accept cryptocurrency as a payment method.