Chinese food company adds Bitcoin to balance sheet

Market speculates on Qatari investment driving bitcoin price surgeRumors are circulating within the cryptocurrency space that Qatar’s sovereign wealth fund may have dabbled in investing in bitcoin, leading to the recent surge in the bitcoin unit price.Such a move, while still an unconfirmed speculation, would be indicative of the increasing recognition of Bitcoin as a mainstream asset class. At the time of writing, bitcoin stands at $44,000. That represents a 16% increase over the space of the past week and a 166% increase since the beginning of the year.Photo by Yiğit Ali Atasoy on UnsplashKeiser’s claimAccording to outspoken Bitcoin advocate Max Keiser, Qatar’s sovereign wealth fund (QSWF), responsible for managing the nation’s significant oil and gas-generated wealth, is considering allocating up to $500 billion to the leading cryptocurrency.To provide context, this investment would eclipse the publicly disclosed bitcoin holdings of MicroStrategy, founded by Michael Saylor, by an astonishing 671 times. MicroStrategy currently holds the position of the largest corporate holder of Bitcoin, with 174,530 BTC acquired in November.Keiser speculates that the QSWF’s monumental investment could propel bitcoin’s price to new highs, reaching $100,000. Keiser tweeted:“The God Candle, a $100,000 uptick in #Bitcoin is in play. It will shift the global axis of wealth and power in 1 tick.”Custodia Bank Founder and CEO Caitlin Long shared a similar view on the X social media platform on Wednesday, pointing out that in September the Emir of Qatar had visited El Salvador and met with President Nayib Bukele. The inference is that it would have been an interest in bitcoin that may have provided the motivation for that visit, given that Bukele and El Salvador have adopted bitcoin as a sovereign currency.However, not everyone is on board with this theory. Some have pointed out that the assertion that the QSWF will invest $500 billion into bitcoin is impossible, given that the fund has $475 billion under management.Bitcoin advocate Luke Broyles weighed in on the rumor, emphasizing the crucial interplay between bitcoin’s supply and demand. Broyles highlighted the $76 billion worth of BTC still available on crypto exchanges, underscoring the fundamental principle of bitcoin’s fixed supply. According to Broyles, any substantial investment would inevitably drive prices higher.However, Broyles remains skeptical of the Qatar news, deeming it a rumor, and expressed shock if it proves remotely true. That view has led many back to the original speculation in relation to this most recent price action, the illusive bitcoin spot exchange-traded fund (ETF) approval in the United States.Some activity in recent days has suggested that BlackRock, the world’s largest fund manager, has been doing preparatory work for the launch of its iShares Bitcoin Trust ETF. Not everyone was positive on the topic of Bitcoin on Wednesday, however. Jamie Dimon, the CEO of JPMorgan Chase, testified before the U.S. Congress on Wednesday, stating “If I were the government I’d close [Bitcoin] down.”

Hong Kong’s Development as Crypto Hub May Soften Chinese Stance on CryptoHong Kong is making waves in the crypto sector that could potentially signal a shift in China’s attitude toward digital assets. That’s a theory that has been given consideration by crypto analytics firm Chainalysis in a recently released report highlighting Hong Kong’s crypto transformation and suggesting a growing tolerance for crypto within China’s corridors of power.Photo by farfar on UnsplashOTC trade showing resilienceDespite China’s stringent regulations and the ongoing crypto market downturn, Hong Kong’s over-the-counter (OTC) crypto market has demonstrated remarkable resilience, with a transaction volume of $64 billion in the past year. While this is slightly less than China’s $86.4 billion, it’s a noteworthy achievement considering Hong Kong’s smaller population and the challenges facing the crypto industry.The close relationship between China and Hong Kong has led some industry commentators to speculate that Hong Kong’s rise as a crypto hub could indicate a shift in China’s stance on digital assets.The crypto-friendly environment in Hong Kong has not gone unnoticed. Merton Lam of Crypto HK, an OTC digital asset trading center in the city, notes that cryptocurrencies have become an integral part of investment portfolios for banks, private equity firms, and high-net-worth individuals in the region. Even Chinese state-owned businesses are launching cryptocurrency-focused investment funds.Hong Kong cornering institutional tradeWhat sets Hong Kong apart in the crypto landscape is its proficiency in large institutional crypto transactions, with 46.8% of its annual crypto trades exceeding $10 million. In contrast, retail trades under $10,000 accounted for just 4% of the city’s crypto volume, slightly below the global average of 4.7%. This institutional dominance distinguishes Hong Kong from other Asian regions.For comparison, South Korea heavily relies on retail trading on centralized exchanges, while Japan maintains a transaction breakdown that aligns closely with global trends, balancing centralized exchanges with DeFi protocols.A cautionary noteHowever, Dave Chapman of OSL Digital Securities offers a note of caution, suggesting that Hong Kong’s promotion as a crypto hub might be more exploratory, aimed at gaining a better understanding of digital assets without significantly loosening mainland policies.Despite the uncertainties, Markus Thielen, Head of Research and Strategy at Singapore’s Matrixport, believes that Hong Kong is acting as a “testing ground” for broader cryptocurrency adoption in China. The city’s unique position makes it an attractive destination for the crypto asset management industry, setting it apart from other jurisdictions that often view crypto firms as service providers rather than end-users.Hong Kong’s progress is particularly noteworthy when considering the broader context of East Asia’s crypto market. Chainalysis analysis reveals that East Asia’s share of crypto transaction value dropped from around 30% in 2019 to less than 10% by the second quarter of 2022 due to China’s crypto bans. Hong Kong’s recent surge could potentially act as a “tailwind” to reignite crypto activity in the region.The evolving relationship between the mainland and the autonomous territory of Hong Kong may hold the key to understanding the future of cryptocurrency in the region.

Zhong An Bank (ZA Bank), Hong Kong’s largest digital bank, has announced that it is now offering crypto trading services to its 800,000 retail customers. The bank set out details of its latest offering in a press release published to its website on Nov. 25. With that, ZA Bank claims to be the first Asian bank to offer crypto trading services to retail customers. Singapore’s DBS Bank was the first conventional bank in Asia to offer crypto services, although in that case, its offering was confined to institutional and accredited investors. It has yet to launch crypto trading for its retail customers.Photo by Traxer on UnsplashHashKey Exchange partnership While DBS built its own crypto exchange platform, in this instance, ZA Bank has decided to partner with local regulated crypto platform, HashKey Exchange. To begin with, the bank will offer Bitcoin and Ethereum in HKD and USD trading pairs. To promote the service, users are being offered commission-free trading during the first three months. A minimum investment level of HKD 600 ($70) has been set. Essentially, ZA Bank customers can access this trading feature through the ZA Bank banking app. Commenting on the partnership, HashKey Exchange CEO Livio Weng stated:”Our collaboration goes beyond technical synergies; it also reflects our shared commitment to upholding the highest regulatory standards. Looking ahead, HashKey Exchange will continue to work closely with ZA Bank to drive the development of the Web3 ecosystem, while delivering more diversified financial services to our users. Together, we aim to usher in a new era of wealth management.” HashKey Exchange is one of three virtual asset exchanges in the Chinese autonomous territory that have been fully regulated and licensed. Facilitating retail demand The bank cited a recent Hong Kong Association of Banks survey, which suggested that 70% of respondents believe that banks offering virtual asset trading services would mean greater convenience for people in accessing cryptocurrencies. Consequently, it would lead to further adoption of cryptocurrencies and it’s on this basis that ZA Bank has launched this latest service, catering to an emerging demand from its customers. Speaking to that, ZA Bank's Alternate Chief Executive Calvin Ng stated:“The rise of cryptocurrency presents investors with more diverse asset allocation opportunities.” On X, Neo blockchain co-founder Da Hongfei described the development as “noteworthy.” In particular, he highlighted the fact that ZA Bank supports account openings not just for Hong Kong residents but also mainland China residents living in Hong Kong. Notwithstanding that, crypto services still remain out of bounds for mainland China residents.  Hongfei also pointed out that the offering doesn’t allow the customer to transfer crypto purchased via the app off the platform. It is strictly limited to trading of crypto between digital assets and fiat currency. This offering by ZA Bank has been in the works for quite a while, with the bank having indicated that an app-based crypto retail offering was in development last December.  In September the bank received approval from the China Securities Regulatory Commission to add digital asset transactions to its Type 1 license. The bank is owned by ZA Global, an affiliate company of Chinese insurance company Zhong An.