So, what happens after someone strikes gold in the world of crypto?
Once the wallets fill up and the market anxiety fades (well mostly), a lot of these freshly-minted millionaires start spending in ways that are equal parts fascinating and “Wait, they bought what?”
According to Henley & Partners and New World Wealth, there are roughly 241,700 people now who hold at least $1 million in crypto assets.
From smart splurges to downright wild indulgences, here are the top ways crypto’s biggest winners are putting their fortunes to work.
Property-Secured Wealth
“I deal with investors who have transformed the volatile crypto gains into property-secured wealth,” said Jeffrey Hensel, broker associate at North Coast Financial.
He said a significant number of these clients approach him when they know that digital gains cannot make much sense without stability or leverage. They are now investing in income-generating property, private lending and bridge financing which is short-term, yet yields interest and has real value when crypto markets move.
“I have funded a few transactions where crypto investors were allowed to buy or refinance California real estate through partial liquidation, which was used to finance other projects,” according to Hensel
He noted they are also understanding that by turning speculative profits into collateralized investments, these millionaires can get liquidity without facing collapsing prices every day.
“It is not a shift towards giving up crypto because it is a shift towards basing it on real assets that have a compounding effect,” Hensel added.
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They Roll Their Profits into the Next Speculative Bet
“A lot of new crypto millionaires don’t diversify once they hit it big,” said Robert Cannon, financial advisor at Experity Wealth.
Instead of cashing out, he said they roll their profits into the next speculative bet, whether that’s NFTs, meme stocks or early-stage DeFi projects. It’s the same mindset that made them money in the first place, but it can easily turn a windfall into a wipeout.
Advice From Experts
“People assume they’ve cracked the code, when really, they just caught the right wave,” said Cannon.
His advice is simple: liquidity and risk management go hand in hand. If you’ve made life-changing gains in a volatile market, take 60 to 70 percent off the table and park it somewhere steadier.
“That could be index funds, bonds, or even a high-yield savings account if you want quick access.”
He said the smartest move is protecting what you’ve already earned.
“Don’t waste time on trying to find the next big thing. Once your base is secure, you can still play in the speculative space, just from a position of strength instead of risk.”
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This article originally appeared on GOBankingRates.com: How Crypto Millionaires Are Spending Their Money
