Bitcoin Investors Banned From Using Gains To Buy Houses
Bitcoin investors looking to cash in on the cryptocurrency's huge spikes in price could face a difficult time getting into the property markets. British mortgage lenders and brokers are rejecting digital currency investors citing money-laundering and inability to trace the source of the money as primary concerns.
Mark Stallard, a broker and principal at House and Holiday Home Mortgages, revealed that one public sector worker who made £40,000 ($55,000) from investing in digital currencies was refused a mortgage due to failing to disclose how he acquired the money.
"I rang two other lenders and they said they would not touch it," Stallard said. "When I mentioned where the money had come from there was massive reluctance to help or understand the problem. I do not believe the mortgage providers in general are ready for this issue and research tells me that a lot more people will be knocking on our doors with funds made or raised in this fashion."
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This is another big blow to the cryptocurrency market which is now being bombarded by regulations and bans across the globe. This is potentially harmful to younger generations who believe it to be one of the only ways to get on the housing ladder.
The many perceived problems with Bitcoin and other cryptocurrencies is that they are not regulated by central banks. However, this is also touted as the biggest factor for their popularity as many proponents of digital currencies see them as a hedge against the dangers of fiat currency.
Still, this doesn't change the fact that potential homebuyers in the UK cannot use profits from Bitcoin and other digital currencies to buy properties. Several building societies said they would not accept a deposit derived from a cryptocurrency, while banks including Santander, Nationwide and Aldermore have yet to come up with formal policies.
For now, this problem is largely contained in the UK. However, there is a big chance other property markets will follow suit. Should this happen, cashing in on the cryptocurrency craze will be harder than ever.
