Hong Kong-based digital asset firm HashKey Group is reportedly aiming to raise funds at a valuation exceeding $1 billion. The company is in early-stage talks to raise between $100 million and $200 million from potential investors, according to Bloomberg. However, details about the size and valuation of the deal may change, as they are not yet finalized.
HashKey operates in various financial areas, such as HashKey Capital, HashKey Custody, brokerage HashKey XPert, HashKey Pro exchange, and Web3 infrastructure HashQuark. The company is part of a growing group of Hong Kong-based digital asset firms seeking to expand their customer base in an increasingly liberalizing environment.
In 2021, HashKey announced it had been granted a Type 9 asset management license from Hong Kong’s Securities and Futures Commission. This allowed the company to manage portfolios consisting only of virtual assets and likely set the stage for its latest offering. Earlier this year, the company closed an investment round worth $500 million for a fund focusing on infrastructure, toolings, and applications that will drive mass adoption of blockchain and cryptocurrency technologies.
So far, only HashKey and BC Technology Group’s OSL bourse have permits to operate a crypto exchange in Hong Kong. However, executives from other exchanges, including OKX and Bitget, have expressed their intention to apply for a license under Hong Kong’s new regulatory regime.
Hong Kong has aggressively pursued its Web3 and blockchain initiatives in an effort to position itself as a hub for digital innovation in Asia and attract crypto firms. The city recently adopted a new regulatory regime that allows retail investors to trade specific “large-cap tokens” on licensed exchanges. This new framework will come into effect next month.
Hong Kong’s efforts to attract crypto firms have already seen positive results, with more than 80 companies working in the digital asset space expressing interest in establishing a presence in the city since October 2022. The city’s improving regulatory stance has also sparked an increase in investor interest in digital assets. In March, Hong Kong investors launched a $100 million fund called ProDigital Future to support early-stage crypto and Web3 companies.
Despite China’s ban on most forms of crypto-activity on the mainland, the country’s government has shown support for Hong Kong’s vision for crypto businesses. Several Chinese state-owned banks in Hong Kong, such as the Bank of Communications, Bank of China, and Shanghai Pudong Development Bank, have started offering services to crypto companies. This puts Hong Kong in a unique position within the Asia-Pacific region in its drive to foster the growth of the digital asset industry.