Game firm’s stock triples after it buys Bitcoin, Hong Kong’s in-kind BTC ETF: Asia Express

Our weekly roundup of news from East Asia curates the industry’s most important developments.

Hong Kong gaming firm to double down on $100 million crypto investment

Shares of Hong Kong online gaming firm Boyaa Interactive have soared 318% over the past month after the firm approved a $100 million initiative to allocate $45 million of corporate funds to Bitcoin (BTC), $45 million to Ether (ETH), and $10 million to stablecoins such as Tether (USDT) and USD Coin (USDC).

“As of the date of this announcement, the Company purchased a total of 1,110 Bitcoin with an average unit price of approximately $41,790, a total of 14,855 Ether with an average unit price of approximately $2,777 and approximately 8,000,000 units of Tether,” the firm said on March 8 while announcing plans to double down on its purchase with an additional $100 million investment into cryptocurrencies.

Aside from the gigantic purchase, the firm also has a solid underlying gaming business, bringing around 100 million yuan ($13.90 million) in revenue and 32.05 million yuan ($4.46 million) in earnings, with growth rates of 6% and 72%, respectively. Due to the ongoing bearish stock market in China, most firms have large cash balances available with some firms trading for far below their nominal book value. 

‘Nobody’ buying Stephen Chow NFTs right now

Nobody, a 10,000 profile picture collection created by legendary Hong Kong director Stephen Chow, has seen its floor price fall over 70% within the past month. 

According to data from OpenSea, the lowest floor price of a Nobody NFT is currently 0.22 Ether apiece, down from its all-time high of 0.99 ETH on Feb. 5.

Despite ongoing promotional activities, including autographs from Chow himself, perks for NFT holders in his upcoming new film, and brand collaboration with reputable artists, traction remains stagnant after an initial launch spike that saw Nobody NFTs surpass 10,000 Ether in trading volume. 

On Feb. 8, Ray Chan, co-founder and CEO of Hong Kong entertainment platform 9GAG, purchased the rare “Monkey King” Nobody NFT for 19.52 Ether, a 3,155% premium to the collectible’s then floor price. Currently, the highest bid for the asset is 0.63 Ether.

No more Bruce Lee NFTs?

Nobody isn’t the only NFT collection to underperform after a bull run chiefly dominated by speculation and euphoria. In April 2023, the Bruce Lee Foundation, directed by the Kung Fu icon’s daughter, Shannon Lee, partnered with NFT video platform Shibuya to launch The House of Lee collection celebrating her father’s life and work. Despite the initial hype, the collection has lost 87% of its value measured in Ether from its highs.

The NFTs were billed as “Your ticket to the House of Lee,” with reports that it was a mere first stage of an ongoing Web3 collaboration. However, no other NFT initiatives have since been launched by the Bruce Lee Foundation since the Genesis collection.

A platypus rollercoaster for Wassies

Another example of hype followed by diminishing returns is Wassies By Wassies, a platypus-themed NFT profile picture collection lauded by DeFi detective ZachXBT. Last year, Wassies launched a pop-up-themed hotel in Singapore, which was followed by a meme-token airdrop announcement for NFT holders scheduled for later this year. As a result, the price of Wassie Avatars subsequently skyrocketed from 0.33 ETH to 2.5 Ether.

However, after the airdrop snapshots for Wassie NFT holders were taken, the price fell back to around 0.75 Ether (still a good return for those who bought in early).

From 2020 to 2021, NFTs as a whole reached record monthly trading volumes of $1 billion. Although traction has recovered as part of the ongoing crypto bull market, they are nowhere near their all-time highs. 

Bybit reprimanded in Hong Kong

It has been a busy week for Hong Kong crypto firms and regulators alike. 

On March 14, Hong Kong’s Securities & Futures Commission (SFC) placed crypto exchange Bybit and 11 of its investment products, including futures, options, leveraged tokens, staking, lending and others, on its official investment warning list.

“The SFC is concerned that these products have also been offered to Hong Kong investors and wishes to make it clear that no entity in the Bybit group is licensed by or registered with the SFC to conduct any ‘regulated activity’ in Hong Kong,” the regulator wrote, adding:

“In Hong Kong, crypto-related products may constitute ‘futures contracts’ or ‘securities’ under the SFO and if so, dealing in and/or marketing these products – whether in Hong Kong or targeting Hong Kong investors – constitute a ‘regulated activity’ and require a licence from the SFC unless an exemption applies. It is a criminal offence to carry out regulated activities without a licence.”

In February, Bybit subsidiary Spark Fintech Limited applied for a retail crypto trading license with the SFC. However, its parent company is not currently registered to operate in Hong Kong. On Feb. 29, the deadline for crypto exchanges to apply for a regulatory license lapsed, with remaining firms now required to leave the city by May 31.

Hong Kong’s ‘in kind’ Bitcoin ETFs

Meanwhile, Gary Tiu, executive director at licensed Hong Kong crypto exchange OSL, revealed that a spot Bitcoin ETF in Hong Kong may have a fundamentally different structure than their United States counterparts if approved.

In a March 14 Bloomberg interview, Tiu said that the Hong Kong operating model “will allow the fund to directly receive BTC from subscribers” and pay Bitcoin “directly to the investors in the case of redemptions,” which would lower trading execution costs. Tiu stated:

“So the level of support we’ve seen, from the issuers and from the whole ecosystem for the Hong Kong products, I think we should be expecting very competitive market-maker behavior in Hong Kong, which will make the product much more attractive to the investors.”

When asked about the prospects of an Ethereum spot ETF, the blockchain executive noted that the U.S. has yet to approve any products in such an area.

“I think there’s definitely a more global race on now for who can actually come to the market with the first product,” he said, adding: “Being first to market is going to be critical for, certainly for the players who are now investing in that space. As of Jan. 29, Hong Kong’s SFC has received its first spot Bitcoin ETF application from Chinese asset manager Harvest.

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Zhiyuan Sun

Zhiyuan Sun is a journalist at Cointelegraph focusing on technology-related news. He has several years of experience writing for major financial media outlets such as The Motley Fool, Nasdaq.com and Seeking Alpha.