Gilbert Arenas -- Drops Millions to Live On the Edge (Of The Valley)

Ni-Hao people of Los Angeles ... ex-NBA star turned Chinese b-baller Gilbert Arenas just dropped a couple million bucks on a sick new pad in the valley ... with killer views (not killer sharks).

Arenas -- who left the NBA in 2012 and now plays for the Shanghai Sharks -- bought a 5,853-square-foot casa in Encino, CA. He still owns his other home in Virginia as well (i.e. the one with the shark tank).

According to docs, Arenas took out a loan for $1.7 million for the digs. It's unclear what the final sale price was, but the house was previously listed for $2.5 million ... so he probably coughed up a hefty down payment.

As for the crib -- despite being in the Valley -- it's pretty sick. Tuscan villa design, 5 bedrooms, 4.5 baths, maids quarters, grill and BBQ ... plus the pool and spa sit at the edge of a cliff, creating views to die for.