Crypto Quill

Shares of Meitu Inc. (HK:1357), the Chinese app operator known for its photo and video editing applications, surged on Thursday, following the company’s announcement that it had sold its entire cryptocurrency holdings for a total of $180 million. This strategic move allowed Meitu to capitalize on the ongoing rally in digital assets, particularly Bitcoin and Ethereum.

Key Details of Meitu’s Crypto Sale

• Assets sold: 940 units of Bitcoin and 31,000 units of Ethereum
• Total proceeds: $180 million
• Profit: Meitu made a substantial gain of about $80 million from its original crypto investment.
• Timing: The sale occurred just ahead of Bitcoin’s milestone surge past $100,000 on December 5, 2024.

The cryptocurrency market has seen significant gains this year, with Bitcoin rising by 140% in 2024, and the bulk of these gains coming after Donald Trump’s presidential election victory, which sparked investor optimism in the market.

Market Reaction

Following the announcement, Meitu’s shares climbed as much as 4%, reaching HK$3.12 on Thursday. The jump in stock price reflects investor confidence in the company’s ability to leverage its crypto holdings at the right time, benefiting from the current bullish trend in the digital asset market.

Dividend and Future Investments

In an effort to reward shareholders, Meitu’s board announced that 80% of the net proceeds from the sale will be distributed as a special dividend of HK$0.109 per share. The remaining funds will be reinvested into Meitu’s core business, focusing on its photo, video, and design products, which are supported by a premium subscription model.

Meitu’s Crypto Investment Journey

Meitu has been one of the few Hong Kong-listed companies to openly disclose its involvement in the cryptocurrency market. The company had initially made its crypto purchases in 2021, investing nearly $100 million in Bitcoin and Ethereum. While the company faced volatility in the crypto market, including significant losses during 2022, the recent surge in cryptocurrency prices allowed Meitu to exit with substantial profits.