Chinese can now buy real estate with Bitcoin

http://www.finextra.com/Community/FullBlog.aspx?blogid=8475

by peter123 • 13 years ago

56 51 13 years ago

creativeone2• 13 years ago

So, I own investment real estate that I wouldn't mind selling for bitcoins. Is there a good place to find buyers who want to pay with Bitcoin?

r3m6• 13 years ago

Why would you care about in which currency you are paid?

dllthomas2• 13 years ago

Cost of conversion would be a potential reason.

GigabyteCoin2• 13 years ago

It's not easy to buy $500,000 worth of bitcoins on the open market at "current value".

travisp• 13 years ago

Most people, for good reason, use an escrow agent when buying and selling real estate (at least here in the US). As a buyer, I would be doubly uncertain about directly transferring someone Bitcoin since it's at least as irreversible as a processed wire, and probably harder to have good legal recourse for. If you can find someone who would do escrow with Bitcoin, you'd probably have better luck.

adestefan• 13 years ago

You'll also need to pay any titling, fees, insurance, and taxes in USD.

jamoes2• 13 years ago

Take a look at BitPremier: http://www.bitpremier.com/. They advertise your high-value good on their site, and then once they pair you up with a buyer they also serve as an escrow agency.

fiatmoney• 13 years ago

Funnily enough, the real estate market is exempt from most money laundering regulations.

http://www.zerohedge.com/news/2013-09-10/money-laundering-ex...

im_a_lawyer• 13 years ago

^ this. The amount of "ultra-luxury" towers going on in my city is way too high. Who the fuck has $800,000 cash? Numbers don't add up.

mfringel• 13 years ago

28000 CNY/sqm * ~.1 sqm/sqft * .16 USD/CNY = ~$448/sqft.

That's coming up on prices in SF, and a little bit more expensive than Boston. I had no idea.

ihsw• 13 years ago

The Chinese property market/household market is a fickle thing -- a lot of it revolves around speculation. There is a suspicion that there will be a large migration of rural workers to urban regions.

And large is an understatement -- everybody is betting everything on it.

maaku3• 13 years ago

a lot of it revolves around speculation

Pretty much all of it. People in Shanghai, for example, use properties as a cash-storage mechanism, thinking it more secure than a CD.

This is all going to end badly.

VintageCool• 13 years ago

Xi Jinping's third plenum starts tomorrow, and many people believe that they will reform the hukou system, allowing people to sell their property in the country and buy property in the city. That could create a lot of urban homebuyers and encourage more migration to urban areas.

mrb8• 13 years ago

FWIW, China seems to be tacitly approving Bitcoin. State-controlled CCTV has been broadcasting more and more news segments about the currency that are all very favorable and positive(!)

A lot of chinese Bitcoin users have reported this stance, eg: https://bitcointalk.org/index.php?topic=320260.0

malandrew• 13 years ago

We've pretty much seen that no other currency is going to undermine the US dollar. It is the de facto reserve currency for the World. This has only been further cemented by globalization since everyone is now so far in bed with the US via trade that everyone has no choice but to let the US keep racking up a national debt. Questioning that debt and forcing default would be tantamount to economic mutually assured destruction. For China, it knows the Yuan is never going to be a real competitor to the US dollar, since there is even less trust in China, since it has been so willing to manipulate exchange rates with its own currency.

AFAICT bitcoin presents the only real existential risk to the US dollar. It's a long long road to get there and it might fail spectacularly or simply become just another currency, but even if there is only 0.1% chance of it upsetting the US dollar, that is 0.1% chance more than any other currency out there.

Personally, if this does play out, I see the US to be one of the last countries to get on the Bitcoin wagon and lose out. Our currency is the most fit and we have the least amount to gain in the short term from adopting it. But this does not change the fact that many countries with far less stable currencies and governments that have proven themselves untrustworthy with their monetary policies, where the citizens would flock to a currency like bitcoin once security and usability issues are addressed. I'd say that every country where inflation is over 4% per annum is a candidate for wanting to acquire bitcoins.

brianwawok• 13 years ago

Well if BTC has a .01% chance to replace USD, the Euro has at least a .005% chance to replace the USD

jafaku• 13 years ago

The US is already holding the largest stash of Bitcoins in the world. They seized about 144,000 BTC from Silk Road.

maaku3• 13 years ago

/me wonders if some high ranking party official bought a lot of btc and is using his nation to pump a bubble...

bpodgursky• 13 years ago

Why would China not like bitcoin? They can

- track all financial transactions by all people to find dissidents and find NGO funding sources

- throw 10% of a datacenter at it whenever they feel like it and pull off a 51% attack

- lock up a huge number of bitcoins via the above point

blake8086• 13 years ago

That would be one powerful data center if it has 5.1 times the hashing power of the bitcoin network.

smaili• 13 years ago

I think this is what makes me nervous about electronic currencies. A country, even just a person, could easily abuse it by throwing these huge machines at it.

The only thing analogous to this with real currencies are printing presses that people somehow get a hold of and are able to print themselves. The nice thing about real currency though is we have some ways of knowing whether they're real or not (like looking under a light), but you can't really determine whether someone's bitcoins came from abuse because technically it's legit. Only solution I could think of would be if there's a way for the networks to have throttling so miners could only make so many per day or per hour or some other metric.

Tuna-Fish• 13 years ago

throw 10% of a datacenter at it whenever they feel like it and pull off a 51% attack

The rise of ASIC miners have made the BTC network essentially invulnerable to attacks from general-purpose devices. SHA is very amenable to being directly implemented in hardware, making general purpose computers useless for bitcoin.

Because of all the new hashing power coming from all the new asic miners, difficulty has risen to the point that you'd need more than four hundred million modern cpu cores to take over the network. Using top of the line GPUs, you'd need more than 5 million of them.

China could take over the BTC network, however, to do so they would have to attack it with ASIC miners. This would imply ~6 months of preparation, tens of millions in funding, and they'd have to make the decision to pull the trigger some 3-4 months in advance or the money would go to waste.

mrb8• 13 years ago

In addition to Tuna-Fish's excellent reply, bpodgursky, you need to ask yourself: what would be China's motive to destroy Bitcoin via a majority ("51%") attack? They have no particular reason to do so. On the contrary, they can instead economically benefit from being a participant in the Bitcoin ASIC design and manufacturing industry. (And they already are: Avalon, Blackarrow, ASICMINER/BlockErupter, etc, all these companies are operating primarily out of China).

Also: China "locking up" coins would do nothing to stop or destroy it. It would just drive the value of the remaining coins higher and as we are seeing right now, an appreciation drive the interest in Bitcoin up, not down.

robk• 13 years ago

I wonder how much of the current BTC price spike is due to new Chinese coming into the market?

jamoes2• 13 years ago

A lot of the current price is because of the Chinese market. If you follow the price surges, usually the exchange BTCChina is the one that starts rising first, followed by the US exchanges. The Genesis Block did a good analysis on the Chinese markets a few weeks ago [1]. I really like the bottom chart in that article, which graphs the price differential between Chinese and US exchanges.

[1] http://thegenesisblock.com/bitcoin-climbs-highest-price-sinc...

mmagin• 13 years ago

And yet, they still cannot invest in foreign stocks.

maaku3• 13 years ago

Those with money do. (Often through BVI shell companies).

trevelyan• 13 years ago

The real question is when they start selling real estate to use bitcoin to move their assets outside China where there is greater ROI.

simbolit• 13 years ago

you realise that if someone is buying real estate, someone needs to be selling it, right?

xux• 13 years ago

there's no shortage of sellers in the Chinese real estate market. It's a bubble.

tokenadult• 13 years ago

From the article: "The current run-up in the price of Bitcoin is an indicator of the interest in the currency, but is likely largely due to speculation." Reporting by economically literate journalists familiar with the situation in China points out that China's housing market is a bubble.[1][2] The speculation in the current residential housing market in China is because middle-class investors cannot find a better investment vehicle, and because they are making unrealistic assumptions about future demand. What's unrealistic about the demand is that migrant workers moving legally to Chinese cities (as they already move illegally) will not possibly be able to afford current market prices for new housing units in China. There is a huge oversupply of housing that is too expensive for anyone to buy who is in the market for a place to live (as contrasted with being in the market for a speculative investment vehicle). The bubble will have to pop. When the China housing bubble pops, China's whole national economy will be severely stressed, and political instability may erupt. The ability to buy houses with Bitcoin reported in this thread is just one more sign of a bubble housing market in China.

[1] http://finance.yahoo.com/news/uncomfortable-truth-chinas-pro...

[2] http://www.forbes.com/sites/realspin/2013/10/28/in-china-the...

tn13• 13 years ago

I suspect that the whole Bitcoin thingy is a Chinese conspiracy.

gbog2• 13 years ago

Then it would have been clever and borderline perverse to use a Japanese disguise for the creation of bitcoin.

Anyway, I think the mystery around bitcoin I'd very captivating a story but probably the answer is more simple than these conspiracy theories, and I was surprised the day I read pg himself give credit to them.

gbog2• 13 years ago

One reason for Chinese government to dislike bitcoin, and it is probably the same reason for Chinese individuals to be interested in it: bitcoins make it very easy to hide cash in your pocket at the customs.

People may not realise it but the big issue for many Chinese or foreigner earning money in China is to get it out of the country. The contemporary art market is in fact fueled by this escaping money, because it is easy to under evaluate a piece of paper with two strikes on it, but recently there is a crackdown against that and experts are checking luggages. Bitcoin might be a much better alternative.

Chinese can now buy real estate with Bitcoin

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