Source: Adobe / chrwittm
Shares in Hong Kong-based app maker Meitu rose over 14% as markets in Asia opened up before correcting slightly after it was revealed the company was making a $ 40 million investment in Bitcoin (BTC ) and Ethereum (ETH) – a first known investment for large companies in the region.
According to market data, the Hong Kong-listed company opened a trading high and peaked around 9:30 a.m. local time before correcting to below Friday’s market close.
Yesterday the company issued an official press release stating that on March 5th it had received a total of “approx. 22.1 million USD and 17.9 million USD “at ETH and BTC (15,000 ETH and just under 380 BTC).
Sina reported that Meitu’s CEO Cai Wensheng justified his company’s move in a social media post, claiming it was made in line with the company’s own blockchain-related business plans – a phrase that roused the wrath Chinese policymakers could still emerge hit the line that crypto and blockchain are not necessarily linked.
Cai was referring to a Chinese proverb about a general who did not starve to death, but plucked up the courage to be the first to eat a fearsome-looking crab – an indication that Cai may think other companies in the area might follow suit.
In a bullish statement, the company hinted it could take further steps in the future and claimed in the official announcement that its board of directors had signaled its approval of the move.
Meitu wrote:
“These purchases were made under a cryptocurrency investment plan previously approved by the Board of Directors […] under which the group can make a net purchase of cryptocurrencies worth up to USD 100 million, financed from existing cash reserves. ”
The company acquired ETH “in preparation for entering the blockchain industry” while the BTC investment is part of its asset allocation strategy.
The crypto movement is unprecedented and surprising to many. Although Hong Kong law is much more laissez-fair in nature than mainland China, where a crypto crackdown took place in September 2017, Meitu operates primarily in the Middle Kingdom and its de facto focus is on China’s Fujian Province. where it was founded.
Crucially, however, the company may have been founded in the Cayman Islands, which in principle could help avoid a backlash from Chinese regulators.
The company is best known for its beauty and skin care apps, including BeautyPlus. However, it is also developing facial recognition technologies and is widely regarded as a company that is on the rise in China.
At the time of writing (08:32 UTC), BTC is trading at $ 49,784 and is down 2% in one day, bringing weekly gains to less than 11%. The ETH is almost unchanged and is quoted at USD 1,683. It’s up 19% in a week.
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