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Putting this out into the universe because as a real estate guy you realize there are more opportunities out there than people to compete with and cities need entrepreneurs doing this work so it’s win-win for all of us.

Disclaimer: This is a thought exercise that in no way constitutes financial or tax advice.

Thesis: Bitcoiners care about their local community and want to improve it in a way that doesn’t jeopardize their stack. Some may find that for other reasons they need to sell a portion of their stack and recognize capital gains.

In the US, there is a tax structure for individuals to take capital gains and push them into physical real estate located within Opportunity Zones. In many communities, the downtown area is within an opportunity zone. By holding assets in the Fund for 10 years the individuals can recognize the step-up on a basis and sell the properties with a dramatically diminished tax liability.

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Discussion

Chris Stark 2mo ago

Concept: Creation of an Opportunity Zone Fund that is structured to hold BTC not as a speculative asset but as the Working Capital under Safe Harbor and 90% Asset Test which would be used to get the equity portion of rehab projects.

This would be achieved through business construction loans through a service like Strike for a less than 18-month term where the proceeds from the BTC collateral would be fully allocated to a rehab project and would be repaid at refinancing to a perm loan or sale.

These loan funds and any additional funds generated through the refinance or sale of an individual asset would be rolled back into the Fund’s BTC balance and immediately be fully deployed as collateral for the next rehab project.

Following 10 years of operations the Fund can step up the basis of assets within the Fund and disburse the gains to the Fund’s investors. Since the Fund holds only BTC as its cash equivalent for working capital for collateral loans, the BTC would be distributed back to the investors at the time of dissolution of the Fund.