Author: Nancy, PANews

As the Web3 environment in Hong Kong becomes more open, in addition to several Hong Kong investment institutions making large-scale purchases of US Bitcoin spot ETFs, more and more Hong Kong-listed companies are also entering the Crypto arena. This article from PANews takes stock of 8 Hong Kong-listed companies that have joined the Web3 wave this year. In addition to allocating a large amount of encrypted assets, these institutions are also integrating their own businesses with Web3 technology and investing in related encrypted projects to promote diversified development and even transformation, which has had a certain boosting effect on their stock prices.

Boyaa Interactive: Plans to purchase up to $100 million in encrypted currency, driving a year-on-year profit growth of 1130% in the latest quarter

Boyaa Interactive is a Hong Kong-listed company whose main business is games. It began to explore the encrypted market in the second half of last year, aiming to comprehensively transform into a Web3 listed company. As of May 16, Boyaa Interactive's stock price has nearly tripled from the beginning of the year, reaching a historical high not seen since February 2016.

In August 2023, Boyaa Interactive announced that its board of directors had approved a budget of $5 million to purchase cryptocurrencies such as Bitcoin and Ethereum, which will be sourced from the group's cash reserves generated from operations in Hong Kong and overseas. Several months later, Boyaa Interactive announced its plan to purchase up to $100 million in encrypted currency in the next 12 months, including Bitcoin, Ethereum, and USDT, stating that the purchase and holding of encrypted currency is an important move for the group's business layout and development in the Web3 field and an important part of the group's asset allocation strategy.

According to the announcement data in March this year, Boyaa Interactive purchased a total of 1110 Bitcoins at an average price of about $41,790, 14,855 Ethereum at an average price of about $2,777, and approximately 8 million USDT. Based on the current (May 16) prices of these encrypted currencies, Boyaa Interactive has a total floating profit of over $30.335 million. According to Boyaa Interactive's latest announcement, its first-quarter profit this year increased by 1130% year-on-year due to encrypted currency.

In addition to purchasing encrypted currency, Boyaa Interactive has also invested in multiple Web3 projects. For example, in April this year, Boyaa Interactive signed a subscription agreement with Pacific Waterdrip Digital Asset Fund SPC to invest $1 million in the fund and strategically cooperate in the development of Web3 games and the Bitcoin ecosystem. Boyaa Interactive also participated in the $1.25 million seed round financing of Web3 asset data platform RootData and invested $500,000 in the Web3 venture capital fund AWAKENING VENTURES, which focuses on programmable Bitcoin networks, Web3 games, Easy Smart Earn (ESE), and application infrastructure (such as application layer protocols).

Furthermore, Boyaa Interactive revealed that it has established a Web3 research and operations team, focusing on the development of Web3 games, related Web3 infrastructure research and development, including wallets, DeFi products, and more.

Coolpad Group: Has purchased $27.86 million in encrypted assets, plans to spin off a Bitcoin mining company for listing in the US

Hong Kong-listed company Coolpad Group is a Chinese enterprise engaged in the research and development of mobile communication terminal equipment and software. Its core business is mobile phones, but it has been facing losses for many years. According to Coolpad Group's mid-year financial report for 2023, its revenue was HK$172 million, and its net loss was HK$117 million, while its revenue reached a peak of HK$24.9 billion in 2014. Due to the delayed release of its 2023 performance report, Coolpad Group has been suspended from trading for some time, and it is expected that the 2023 audit will be completed by the end of June 2024.

Due to poor performance in the mobile phone business, Coolpad Group has begun to explore new businesses. Recently, Coolpad Group announced that it is actively seeking opportunities to enter the digital currency field, believing that this is an opportunity to expand its encrypted business and provide another source of income, making its business more diversified. Its wholly-owned subsidiary, Digital Tech, has purchased $27.86 million in encrypted assets, acquiring 1,500,000 shares of Bitcoin mining company Cleanspark's stock (CLSK) at a total cost of approximately $23.84 million between April 16 and May 8, 2024 (approximately $15.89 per share), and 113,000 shares of IBIT stock at a total cost of approximately $4.03 million between April 19 and May 8, 2024 (approximately $35.64 per share). Based on the current price (May 16), Coolpad Group has a floating profit of over $2.074 million.

It is worth mentioning that in addition to launching a new business related to encrypted asset mining by the end of 2023, Coolpad Group has also made significant capital expenditures related to properties, factories, and equipment, such as spending over $12 million from August to November 2023 to purchase electronic computing servers for encrypted mining. It is also considering spinning off its wholly-owned subsidiary, Coolbit Technologies Limited, and the possibility of independently listing it on the Nasdaq in the United States. It is reported that this subsidiary has launched a digital currency investment business since the second half of last year, focusing on Bitcoin mining.

Lanxum Interactive: Increases the limit for purchasing encrypted currency to $6 million

Mobile game developer Lanxum Interactive has been involved in Web3 business and related assets since last year. In September 2023, Lanxum Interactive announced that it had purchased a total of 92.4712 Bitcoins in public market transactions on June 15, 2023, July 7, 2023, August 8, 2023, and August 17, 2023, and had also purchased 93.85 Bitcoins for approximately $2.7 million in the 12 months prior to the date of the announcement.

Since the beginning of 2024, Lanxum Interactive has been accelerating its layout in the encrypted business. In late January, Lanxum Interactive announced that its board of directors had authorized and empowered the purchase of encrypted currency in public market transactions to be increased from a maximum of $5 million to $6 million. At the same time, Lanxum Interactive also successively announced investments in multiple encrypted projects, such as the Bitcoin RGB domain infrastructure BiHelix, the Bitcoin Layer2 expansion solution Merlin Chain, and the Bitcoin cross-chain bridge XLink.

As of May 16, Lanxum Interactive's stock price has nearly tripled from the beginning of the year and has reached a new high since March 2020.

Guofu Innovation: Plans to spend HK$5 million to purchase encrypted currency, has previously made multiple layouts

Hong Kong-listed company Guofu Innovation is also actively carrying out Web3-related business layouts and believes that investing in encrypted currency will enable the group to better adapt to the constantly changing market conditions and help the business transition positively from the traditional financial industry to innovative finance and technology finance.

As early as August 2023, Guofu Innovation's wholly-owned subsidiary, Fuqiang Securities, submitted an application to the Hong Kong Securities and Futures Commission to engage in virtual asset-related activities, aiming to provide investors with more diversified services to explore new sources of income. Shortly thereafter, Guofu Innovation announced its entry into the virtual asset field again. Its wholly-owned subsidiary, Fortune Genesis Holdings Limited, plans to acquire a fund worth $1.6 million from the company's chairman, Liu Zhiwei. The investment target entity of the fund is SEBA Bank AG, a bank entity mainly engaged in encrypted currency-related banking services.

Recently, Guofu Innovation announced that its board of directors has approved a budget of HK$5 million for the group to invest in encrypted currency and virtual asset funds in the next year. This budget will mainly be used to purchase encrypted currency (mainly including Bitcoin) on regulated and licensed trading platforms and to subscribe to regulated virtual asset funds in Hong Kong (i.e., funds managed by managers authorized to engage in regulated activities under the Securities and Futures Ordinance, and approved to invest more than 10% of the total asset value of the portfolio 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 Roundcoin Technology, digital exchange TideBit, digital asset bank SEBA Bank, and recently invested $1.5 million in Web3 music startup Star Nest through its wholly-owned subsidiary, Chuangqi International Limited.

Since Guofu Innovation announced its plan to purchase encrypted currency, as of May 16, although its stock price has only achieved a single-digit increase, it has reached a new high since December 2020.

Ying Universe: Plans to spend $100 million on purchasing encrypted currency in the next 5 years

Ying Universe is a Hong Kong-listed interactive social platform that renamed itself in 2022 to enter the metaverse business. Its products include Yingke Live, Duiyuan, Super Like, and Jimu, mainly involving live streaming, dating, and social networking. According to Ying Universe's 2023 annual financial report, its total revenue in 2023 was HK$6.84 billion, and its net profit reached $400 million, a year-on-year increase of 337.8%.

In March this year, Ying Universe announced that the investment in encrypted currency 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 $100 million for the group to purchase encrypted currency on any regulated and licensed trading platform in the next five years, with the funds coming from its existing cash reserves. The stock price of Ying Universe did not show a significant increase due to this news but reached a new high for the year.

Zlongame: Collaborating to develop Web3 games and purchasing virtual assets

Hong Kong-listed company Zlongame is a global IP game operator, with a total operating income of HK$2.6 billion in 2023 and a net profit turning from loss to profit of HK$5.379 million. Zlongame is also actively laying out in the Web3 field. In addition to being a member of the Hong Kong Web3.0 Association, it recently reached a cooperation with Hashkey Group to promote the development of Web3 games and game platform business and will open an account to purchase virtual assets on HashKey Exchange. In addition, HashKey Group will provide institutional virtual asset custody services to Zlongame.

Possibly influenced by this news, as of May 16, Zlongame's stock price has risen by over 23.8%, reaching a new high for 2024.

Huak Intelligent Investment: Delving into the encrypted currency market and capturing investment opportunities

Huak Intelligent 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 an account on HashKey Exchange last year, Huak Intelligent Investment also recently announced that its wholly-owned subsidiary signed a fund subscription agreement and limited partnership agreement with "Tide Investment One Limited Partnership" established and managed by Tide Capital on April 23 this year. The fund investment aims to enable the company to delve into the digital asset and encrypted currency market and capture investment opportunities in this field through the professional advantages of TideCapital.

Since the announcement, the stock price of Huak Intelligent Investment has not shown significant changes.

Victory Securities: Hong Kong's first virtual asset retail broker, has launched virtual asset trading business

Victory Securities is Hong Kong's first virtual asset retail broker. According to the disclosed data by Chen Peiquan, Executive Director of Victory Securities, at the end of 2023, the monthly turnover of its virtual asset trading services reached $10 million and has been profitable.

This year, Victory Securities not only launched the stock and coin trading app VictoryX to allow users to trade stocks and encrypted currency on the same platform but also reached deep cooperation with 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 subscription.

In terms of market performance, Victory Securities' stock price has experienced a long period of decline but began to rise significantly at the end of November last year and reached a historical high in April this year.

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