Will Chinese Investors Consider Cryptocurrencies?
The Chinese authorities have introduced stricter policies targeting rich investors in the country who hold their wealth overseas to avoid large taxes.
The question is whether this will encourage Chinese investors to look into other solutions like investing in cryptocurrency.
Are Investors Turning To Cryptocurrency?
The Chinese government has recently started to work with agencies in 83 countries that follow the Common Reporting Standards (CRS) that are introduced by the Organization for Economic Cooperation and Development (OECD), as CCN explain in their report.
According to the article, the Chinese government is expected to communicate directly with the Virgin Islands, Bermuda, Luxemburg, Switzerland, and the Bahamas. Investors are known to invest their savings in the offshore banking sector that`s usually located in regions like these ones.
China has announced that the countries under CRS and OECD are 83 and have agreed to share data related to financial accounts held by Chinese citizens. In this way, the Chinese government can potentially target high profile millionaire investors.
Chinese Real Estate Investors Go To Hong Kong
Many Chinese real estate investors launch a shell company in Hong Kong. That`s how they move money from China to Hong Kong.
Seems like it's not easy for the Chinese government to restrict money flowing from China to the Hong Kong real estate market as it would require a highly impractical process of banks and the government working on censoring and monitoring every transaction.
Nevertheless, it is still possible for the government to focus on individual investors who have lots of money in foreign assets and cash that are placed in offshore savings accounts.
Cryptocurrencies like ethereum and bitcoin may show up to be an asset that`s safe to invest in if investors want to escape the governments` intervention.
One question that remains, however, is whether these investors have something to hide and whether regulation of crypto assets is necessary to prevent them from being used for suspicious business goals.
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