The [UK] government approved China's proposal to redevelop the former Royal Mint site [in London] into a vast 215,300 sq ft (20,000 sq m) UK headquarters, despite opposition from politicians and campaigners.
About 200 people live in Royal Mint Court, a complex of flats on the site, with many fearing a loss of privacy, disruption caused by protests and eviction.
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On Tuesday evening, Royal Mint Court Resident's Association announced they had reached their target of £145,000 in donations, jumping from £35,000 12 hours earlier.
Campaigners say they will challenge the legality of the government's decision and believe there could be several grounds on which to bring their case.
These could include whether the government had a predetermined view on the development and whether redactions were made by the Chinese when they were asked to reveal detailed plans.
Planning law specialist Lord Charles Banner KC has been instructed to act for the association, they added.
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Royal Mint Court resident and treasurer for the group, Mark Nygate, said they had received donations from people across the UK.
"We are humbled that so many of those persecuted by the CCP (Chinese Communist Party), together with ordinary Brits up and down the country, have placed their faith in us, and stood by residents.
"We won't waste a single penny in ensuring that this embassy plan crashes on the solid rock of our judicial system."
The residents' campaign has the support of the Inter-Parliamentary Alliance on China (IPAC), a group set up to hold China to account on democracy and human rights issues.
Luke de Pulford, from the group, said: "The blistering speed with which this crowdfunder has reached its target is a clear indication of the sheer unpopularity of this mega-embassy.
"It remains to be seen if the world's second superpower is a match for UK planning law."
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The embassy would be the biggest of its kind in Europe and would sit in close proximity with the financial district as well as fibre optic cables carrying sensitive information.
Opponents have warned it could serve as a base for spying and pose security risks.
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