The 2018 cryptocurrency bear market hasn’t stopped some cryptocurrency startups and cryptocurrency-related companies from snapping up some of the top spots in Hong Kong, home to one of the priciest real estate markets in the world.
In fact, the soaring rent prices have actually pushed out more traditional financial institutions such as BNP Paribas SA and Goldman Sachs of some of the most prestigious buildings in the Asian financial hub. There are many in the cryptocurrency community who view this as a symbolic shift, considering that many cryptocurrency enthusiasts believe that digital assets have the ability to replace traditional financial banks altogether.
Moving On Up
One of the most notable companies that has entered some of this prestigious space is Diginex, a cryptocurrency mining operation backed by Madison Holdings Group, an investment company formerly known as Madison Wine, that used to be focused on alcohol-related companies but has since moved into the blockchain sector.
Diginex has mining operations in Asia, Switzerland and Sweden. The chairman explained in an e-mail that the office space was needed as the company is “aggressively hiring and expanding across all functions”.
Bitmex , which is known globally as a cryptocurrency exchange that facilitates margin trading for Bitcoin and Ethereum, recently decided to move its headquarters to the Cheung Kong Center, breaking the record for the most expensive office space – as it has rented out the entire 45th floor. Philip Pang of Colliers International, a global real estate organization, stated that it was clear that blockchain companies were intentionally seeking out these spaces as a way to “attract and retain talent”.
Landlords Are Sceptical
Despite the fact that the entire cryptocurrency market has dropped by 80% in terms of market capitalization; cryptocurrency exchanges have prospered. Despite the fact that these cryptocurrency-related businesses have profited handsomely, landlords are not sure of the sector, as evidenced by the fact that local publications are reporting that landlords asked BitMEX to pay for an entire year of rent upfront, which totals to over $6 million.
In contrast, Goldman Sachs recently moved from central Hong Kong to Causeway Bay , saving around 30% on rent. They are not the only financial institution to have done so, as they have followed other globally-known financial institutions such as Morgan Stanley and Credit Suisse.