Buying Real Estates with Crypto. How does it work?

Buying Real Estate with Cryptocurrency: Countries, Legal and Financial Aspects, and Real-World Examples

The integration of cryptocurrencies into real estate markets has opened new avenues for investors seeking to diversify their portfolios with digital assets. As cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH) gain mainstream acceptance, several countries have adapted their legal frameworks to facilitate property purchases using these decentralized currencies. This article explores the countries where buying real estate with cryptocurrency is possible, the legal and financial considerations involved, and real-world examples of such transactions. It concludes with practical tips for prospective buyers.

Countries Where You Can Buy Real Estate with Cryptocurrency

Several nations have embraced cryptocurrencies for real estate transactions, either by recognizing them as legal tender or by allowing their use through regulated channels. Below are some of the most prominent countries where such purchases are feasible, based on their regulatory environments and market practices:

  1. El Salvador: As the first country to adopt Bitcoin as legal tender in 2021, El Salvador allows direct real estate purchases with BTC. The government’s pro-crypto policies, including zero capital gains tax on Bitcoin, make it an attractive destination for crypto investors. Properties can be bought directly with BTC, and the country promotes itself as a tax-free haven for such transactions. However, adoption remains limited, with only about 7.5% of the population using Bitcoin for transactions.

  2. Portugal: Portugal is one of the most crypto-friendly nations in Europe, particularly in regions like Madeira. Since April 2022, notaries can ratify real estate deals involving cryptocurrencies without requiring conversion to fiat currency, classifying them as barter transactions. While short-term crypto gains (held less than a year) are taxed at 28%, long-term holdings (over a year) are exempt from capital gains tax for tax residents, making it appealing for investors.

  3. United Arab Emirates (UAE): The UAE, particularly Dubai, is a burgeoning crypto hub. While cryptocurrencies are not recognized as legal tender, real estate agencies facilitate transactions by converting crypto to fiat (e.g., AED) through licensed exchanges. The UAE’s Golden Visa program allows residency through property investments starting at AED 750,000 (~$204,000), attracting crypto investors. However, a 5% VAT applies to goods and services, including crypto transactions.

  4. Thailand: Thailand legalized cryptocurrency use in 2014, allowing property purchases through accredited real estate agencies. Transactions typically involve transferring crypto to the seller’s wallet, followed by conversion to Thai baht for official registration. While individuals can use crypto, regulated financial institutions like banks cannot, requiring alternative transfer systems.

  5. Montenegro: A financially liberal Balkan nation, Montenegro has no specific restrictions on crypto transactions, including real estate purchases. The country actively courts crypto investors, notably granting citizenship to Ethereum co-founder Vitalik Buterin in 2022. Transactions require notarization, ensuring compliance with local laws.

  6. Georgia: In Georgia, cryptocurrencies are treated as assets, not legal tender, and real estate purchases are considered barter transactions. Buyers work through licensed agencies, with final purchase amounts recorded in fiat (GEL). Purchasing property worth $100,000 or more can grant residency, making it appealing for crypto investors seeking diversification and mobility.

  7. Vanuatu: Vanuatu fully legalized cryptocurrencies and offers citizenship-by-investment programs, making it attractive for crypto investors. Properties are often purchased on long-term leases (up to 75 years), with no capital gains tax, enhancing its appeal. The real estate market is most developed on Efate, home to the capital, Port Vila.

  8. Switzerland: Known for its crypto-friendly “Crypto Valley” in Zug, Switzerland allows real estate purchases with cryptocurrencies in certain cantons. Regulations vary by canton, but Bitcoin enjoys fewer restrictions than other cryptocurrencies. The country’s stable economy and low-risk financial system make it a secure option for investors.

Legal and Financial Aspects

Legal Considerations

The legal status of cryptocurrencies significantly impacts their use in real estate. In countries where crypto is recognized as legal tender (e.g., El Salvador), direct purchases are straightforward. Elsewhere, cryptocurrencies are often classified as assets or commodities, requiring conversion to fiat for official registration or notarization. Key legal aspects include:

  • Notarial Oversight: In countries like Portugal, Montenegro, and Spain, notaries play a critical role in verifying transactions and ensuring compliance with anti-money laundering (AML) and know-your-customer (KYC) regulations. In Portugal, for instance, nearly 50% of crypto-based real estate deals are declined due to AML compliance issues or notaries’ limited crypto knowledge.

  • Regulatory Compliance: Most countries mandate AML/KYC checks to prevent illicit activities. Buyers must provide documentation to verify the source of their crypto funds, which can complicate transactions in jurisdictions with strict capital controls, like Ukraine.

  • Contractual Frameworks: Smart contracts, powered by blockchain, are increasingly used to automate and secure transactions, reducing reliance on intermediaries. However, their adoption is limited, and traditional contracts often govern crypto-based property deals.

Financial Considerations

Using cryptocurrency for real estate involves unique financial dynamics:

  • Tax Implications: Capital gains taxes may apply when converting crypto to fiat or selling appreciated assets. For example, Canada enforces capital gains tax on crypto transactions, while Portugal offers tax exemptions for long-term holdings. Buyers should consult tax specialists to optimize their tax burden.

  • Volatility: Cryptocurrencies are highly volatile, posing risks for both buyers and sellers. A property priced in Bitcoin could fluctuate significantly in value before the transaction closes, necessitating clear pricing agreements at the time of transfer.

  • Transaction Costs and Speed: Crypto transactions often have lower fees and faster processing times compared to traditional bank transfers, especially for international deals. For instance, blockchain-based transfers can settle in minutes, avoiding days-long delays.

  • Financing Limitations: Direct crypto purchases typically require full payment, as most lenders do not accept crypto for mortgages. However, platforms like Milo in the U.S. offer crypto-collateralized loans, though these carry risks like margin calls if crypto values drop.

Real-World Examples

  1. Michael Saylor in Miami, USA (2022): Michael Saylor, CEO of MicroStrategy and a prominent Bitcoin advocate, purchased a luxury penthouse in Miami for $22.5 million in BTC in 2022. The transaction, one of the largest crypto-based property deals globally, was facilitated through a licensed real estate agency that converted the Bitcoin to USD for registration. The deal highlighted Miami’s growing acceptance of crypto in its luxury real estate market, though it required compliance with U.S. AML regulations and capital gains tax considerations.

  2. Anastasia Kor in Dubai, UAE (2023): Anastasia Kor, a board member of Choise.com, acquired a high-rise apartment in Dubai using Ethereum. The transaction, valued at approximately $1.2 million, was processed through a Dubai-based agency that converted ETH to AED via a licensed exchange. Kor noted the efficiency of blockchain-based transfers, which reduced transaction fees and time compared to traditional methods. The deal complied with UAE’s Virtual Assets Regulatory Authority (VARA) guidelines, ensuring transparency and security.

Conclusion: Tips and Hints for Future Buyers

Buying real estate with cryptocurrency offers exciting opportunities but requires careful planning. Here are some tips for prospective buyers:

  • Research Local Regulations: Verify the legal status of cryptocurrencies in your target country and ensure compliance with AML/KYC requirements. Engage local legal experts to navigate notarial and tax obligations.

  • Work with Reputable Agencies: Partner with accredited real estate agencies or platforms like XEROF or Crypto Emporium, which specialize in crypto transactions and ensure compliance with local laws.

  • Mitigate Volatility Risks: Agree on a fixed fiat price at the transaction’s outset or use stablecoins like USDT or USDC to minimize exposure to crypto price swings.

  • Understand Tax Implications: Consult tax professionals to assess capital gains or property taxes in the purchasing country. Countries like Portugal and Vanuatu offer tax advantages for crypto investors.

  • Leverage Blockchain Technology: Explore smart contracts for secure, transparent transactions, but ensure they are recognized by local authorities. Platforms like Quarteria can facilitate tokenized real estate investments for added liquidity.

  • Verify Property and Seller: Conduct due diligence on the property and seller, using local agents or surveyors to confirm legitimacy. Escrow services can protect your crypto during the transaction.

As cryptocurrencies continue to reshape global finance, their role in real estate is set to grow, driven by blockchain’s efficiency and transparency. By staying informed and working with trusted professionals, investors can capitalize on this innovative intersection of technology and property markets.


This article was prepared by the team of dedicated professionals of Migrate Global.

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