Author: Nancy, PANews
As the Web3 environment in Hong Kong becomes more open, in addition to a number of Hong Kong investment institutions purchasing US Bitcoin spot ETFs, more and more Hong Kong stocks are also entering the Crypto track. In this article, PANews lists 8 Hong Kong listed companies that have joined the Web3 wave this year. In addition to investing heavily in crypto assets, these institutions have also combined their own businesses with Web3 technology, and invested in related crypto projects to promote business diversification and even transformation, which has a certain boost to their own stock prices.
Boyaa Interactive: Plans to purchase up to $100 million in cryptocurrencies, driving the latest quarterly profit to grow 1130% year-on-year
Boyaa Interactive is a Hong Kong-listed company whose main business is gaming. It began testing the crypto market in the second half of last year, aiming to fully transform into a Web3 listed company. As of May 16, Boyaa Interactive's stock price has increased by nearly 3.6 times from its highest point at the beginning of the year, setting a record high since February 2016.
In August 2023, Boyaa Interactive announced that the board of directors had approved a budget of US$5 million to purchase cryptocurrencies such as Bitcoin and Ethereum. The funds came from the cash reserves generated by the group's operations in Hong Kong and overseas. A few months later, Boyaa Interactive announced again that it plans to purchase up to US$100 million in cryptocurrencies, including Bitcoin, Ethereum and USDT, in the next 12 months, and stated that purchasing and holding cryptocurrencies is an important measure for the group to carry out business layout and development in the Web3 field and an important part of the group's asset allocation strategy.
According to the data released in March this year, Boyaa Interactive purchased 1,110 Bitcoins at an average price of about $41,790, 14,855 Ethereums at an average price of about $2,777, and about 8 million USDT. Based on the current (May 16) prices of these cryptocurrencies, Boyaa Interactive has made a total profit of more than $30.335 million. According to the latest announcement from Boyaa Interactive, its profit in the first quarter of this year increased by 1,130% year-on-year due to cryptocurrencies.
In addition to purchasing cryptocurrencies, Boyaa Interactive has also invested in multiple Web3 projects. In April this year, Boyaa Interactive signed a subscription agreement with Pacific Waterdrip Digital Asset Fund SPC, investing US$1 million in the fund and conducting strategic cooperation in Web3 game development and Bitcoin ecology. The latter mainly invests in projects such as the metaverse, NTF and blockchain fields of Web3 infrastructure; Boyaa Interactive participated in the US$1.25 million seed round of financing for Web3 asset data platform RootData; Web3 venture capital fund AWAKENING VENTURES received a US$500,000 investment from Boyaa Interactive, mainly used for investment directions such as programmable Bitcoin networks, Web3 games, Easy Smart Earn (ESE), application infrastructure (such as application layer protocols), etc.
In addition, Boyaa Interactive revealed that it has formed a Web3 research and operations team, which will focus on the development of Web3 games and related Web3 infrastructure research and development, including wallets, DeFi products, etc.
Coolpad Group: Has purchased $27.86 million in crypto assets and plans to spin off its Bitcoin mining company for listing in the U.S.
Coolpad Group, a Hong Kong-listed company, is a Chinese company engaged in the development of mobile communication terminal equipment and software. Its core business is mobile phones, but it has been facing years of losses. According to the 2023 interim financial report disclosed by Coolpad Group, its revenue was HK$172 million and its net profit loss reached HK$117 million. In 2014, its revenue reached a peak of HK$24.9 billion. Due to the delay in the release of the 2023 performance report by Coolpad Group, it has been suspended for a long time. It is expected that the 2023 audit will be completed by the end of June 2024.
Due to the poor performance of its mobile phone business, Coolpad Group began to explore new businesses. Recently, Coolpad Group announced that the group is actively seeking opportunities to enter the field of digital currency. The company believes that this is an opportunity for it to expand its encryption business, which also makes the group's business more diversified and provides another revenue channel. Its wholly-owned subsidiary Digital Tech has purchased $27.86 million in crypto assets, and acquired 1,500,000 shares of Bitcoin mining company Cleanspark CLSK (approximately $15.89 per share) at a total cost of approximately $23.84 million from April 16 to May 8, 2024, and 113,000 shares of IBIT (approximately $35.64 per share) at a total cost of approximately $4.03 million from April 19 to May 8, 2024. Calculated at the current price (May 16), Coolpad Group has a floating profit of more than $2.074 million.
It is worth mentioning that in addition to launching a new business related to crypto asset mining by the end of 2023 and making large capital expenditures related to property, plant and equipment, such as spending more than US$12 million to purchase electronic computing servers for crypto mining from August to November 2023, Coolpad Group is also considering the possibility of spinning off its wholly-owned subsidiary Coolbit Technologies Limited and listing it independently on Nasdaq in the United States. It is reported that the subsidiary has launched a digital currency investment business since the second half of last year, focusing on Bitcoin mining.
Linekong Interactive: Increase cryptocurrency purchase limit to US$6 million
Mobile game developer Linekong Interactive started to enter the Web3 business and related assets as early as last year. In September 2023, Linekong Interactive announced that it purchased a total of 92.4712 bitcoins in open market transactions on June 15, 2023, July 7, 2023, August 8, 2023 and August 17, 2023, and in the 12 months prior to the date of this announcement, Linekong Interactive also purchased 93.85 bitcoins for approximately US$2.7 million.
Since entering 2024, Linekong Interactive has been accelerating the layout of its crypto business. In late January this year, Linekong Interactive announced that the board of directors was authorized and empowered to adjust the maximum amount of cryptocurrency purchases in open market transactions from a maximum of US$5 million to US$6 million. At the same time, Linekong Interactive also announced investments in multiple crypto projects, such as Bitcoin RGB field infrastructure BiHelix, Bitcoin Layer2 expansion solution Merlin Chain, and Bitcoin cross-chain bridge XLink.
As of May 16, Bluehole Interactive's stock price had nearly increased 2.7 times from the beginning of this year, and at one point reached a new high since March 2020.
Guofu Innovation: Plans to spend HK$5 million to buy cryptocurrencies, having made several investments before
Hong Kong-listed company Guofu Innovation is also actively developing Web3-related business layout, and believes that investment in cryptocurrencies will enable the group to better adapt to changing market conditions and will help the business to actively transform from the traditional financial industry to innovative finance and technology finance.
As early as August 2023, Fortune Securities, a wholly-owned subsidiary of Fortune Innovation, submitted an application to the Hong Kong Securities Regulatory Commission for its proposed activities related to virtual assets, aiming to provide investors with a more diversified service strategy to open up new sources of income. Soon after, Fortune Innovation announced its entry into the virtual asset field again. Its wholly-owned subsidiary Fortune Genesis Holdings Limited intends to acquire a fund equity of US$1.6 million from the company's chairman, Liu Zhiwei, in Summer Feeder Fund Limited. The fund's investment target entity is SEBA Bank AG, a banking entity that mainly engages in cryptocurrency-related banking services.
Recently, Guofu Innovation announced that its board of directors has approved a budget of HK$5 million for the group's investment in cryptocurrencies and virtual asset funds in the next year. The budget will be mainly used to purchase cryptocurrencies (mainly including Bitcoin) on regulated and licensed trading platforms; and subscribe to Hong Kong compliant virtual asset funds (i.e., virtual asset funds whose fund managers are approved to engage in Category 9 regulated activities under the Securities and Futures Ordinance and are approved to invest more than 10% of the total asset value in their portfolios in virtual assets or indirectly invest in virtual assets). In addition, Guofu Innovation has previously invested in virtual asset management company MaiCapital, stored value payment tool company Yuanbi Technology, digital exchange TideBit and digital asset bank SEBA Bank, and recently invested US$1.5 million in Web3 music startup Star Nest through its wholly-owned subsidiary Chuangqi International Limited.
Since Guofu Innovation announced plans to purchase cryptocurrencies, as of May 16, although its stock price has only achieved a single-digit increase, it has hit a new high since December 2020.
Yingyuzhou: Plans to spend $100 million on cryptocurrency in the next five years
Yingyuzhou is an interactive social platform listed on the Hong Kong Stock Exchange. It was renamed in 2022 to enter the metaverse business. Its products include Yingke Live, Duiyuan, Super Like, Jimu, etc., mainly involving three major business sectors: live broadcast, blind date and social networking. According to the 2023 annual performance financial report released by Yingyuzhou, its total revenue in 2023 was 6.84 billion yuan, and its net profit reached 400 million US dollars, a year-on-year increase of 337.8%.
In March this year, Ying Yuzhou announced that cryptocurrency investment is an important part of the group's Web3 business development strategy and asset allocation strategy. Its board of directors has approved a budget of US$100 million for the group to purchase cryptocurrencies on any regulated and licensed trading platform in the next five years. The source of funds will be its existing cash reserves. Ying Yuzhou's stock price did not rise significantly due to this news, but it hit a new high this year.
Zhongshouyou: Cooperate to develop Web3 games and purchase virtual assets
CMGE, a Hong Kong-listed company, is a global IP game operator with a total operating revenue of 2.6 billion yuan in 2023 and a net profit of 5.379 million yuan. CMGE is also actively developing the Web3 field. In addition to being a member of the Hong Kong Web3.0 Association, it has recently reached a cooperation with Hashkey Group to promote the development of Web3 games and game platform businesses, and will open an account at HashKey Exchange to purchase virtual assets. In addition, HashKey Group will also provide institutional virtual asset custody services for CMGE.
Perhaps affected by this news, as of May 16, the stock price of Zhongshouyou had risen by more than 23.8%, reaching a new high since 2024.
Huake Smart Investment: Will delve into the cryptocurrency market and capture investment opportunities
Huake Smart Investment is a cross-border investment platform listed on the main board of the Hong Kong Stock Exchange. In addition to announcing the opening of HashKey Exchange last year, Huake Smart Investment also recently announced that its wholly-owned subsidiary signed a fund subscription document and limited partnership agreement for a fund called "Tide Investment One Limited Partnership" established and managed by Tide Capital on April 23 this year. At the same time, Huake Smart Investment stated that the fund investment is intended to enable the company to delve into the digital asset and cryptocurrency market and capture investment opportunities in this field through TideCapital's professional advantages.
Since the announcement, the share price of Huake Intelligent Investment has not changed significantly.
Victory Securities: Hong Kong's first virtual asset retail brokerage, has launched virtual asset trading business
Victory Securities is the first virtual asset retail broker in Hong Kong. According to data disclosed by Victory Securities Executive Director Chen Peiquan at the end of 2023, its virtual asset trading services have an average monthly turnover of US$10 million and have already made a profit.
This year, Victory Securities not only launched the stock-to-cryptocurrency trading application VictoryX to allow users to trade stocks and cryptocurrencies on the same platform, but also reached in-depth cooperation with encryption projects such as HashKey Exchange and TokenPocket. It also became the only participating securities firm in Hong Kong's first batch of Bitcoin and Ethereum spot ETFs to accept physical subscriptions.
Judging from market performance, after a long period of slump, the share price of Shengli Securities began to rise sharply at the end of November last year and hit a record high in April this year.
