Asia Exchanges Clamp Down on Crypto-Hoarding Corporations - Regulatory Storm Brews
Asian financial hubs are drawing battle lines against companies treating crypto like digital treasure chests.
The Regulatory Hammer Drops
Exchanges across Tokyo, Hong Kong, and Singapore are implementing strict new oversight measures. They're targeting corporations that treat cryptocurrency reserves like personal piggy banks rather than strategic assets.
Compliance Over Crypto Dreams
Financial authorities are demanding transparent accounting for every satoshi. No more hiding digital assets in corporate shadows. The days of 'crypto-rich, cash-poor' balance sheets are numbered.
The New Reporting Reality
Quarterly disclosures now require detailed crypto position breakdowns. Market-moving announcements can't just materialize from digital wallets anymore. Because apparently, 'trust me bro' isn't a valid auditing principle.
Another day, another attempt to regulate decentralized assets into centralized submission - because nothing says financial innovation like more paperwork.
Hong Kong Leads the Crackdown
In Hong Kong, at least five companies have recently applied to change their main focus to buying and holding digital assets, but none have been approved. The exchange argues that listed firms must show their business is “viable, sustainable, and of substance.”
This means companies cannot simply shift to buying and holding crypto without an operational purpose. Simon Hawkins, a partner at Latham & Watkins, said approval depends on proving that acquiring crypto is “part and parcel of their operating business.”
India and Australia Follow Strict Rules
In India, the Bombay Stock Exchange recently rejected Jetking Infotrain’s plan to list shares from a new allotment. The company had planned to invest some proceeds in crypto. Jetking has appealed the decision, but both it and the BSE have declined to comment, according to Bloomberg.
Meanwhile, in Australia, ASX Ltd. rules make it nearly impossible for firms to hold 50% or more of their balance sheet in cash or similar assets.
The ASX said that firms wanting to hold crypto directly should instead consider creating exchange-traded funds, or ETFs, for investors. “Otherwise, they are unlikely to be considered suitable for admission,” an ASX spokesperson said.
Japan Stands Out with a Softer Approach
Japan stands apart as an exception. There, companies are allowed to hold large amounts of Bitcoin, as long as they make proper disclosures. One of the most popular examples is Metaplanet Inc., a hotel operator. The firm began its shift in early 2024 and now holds about $3.3 billion in Bitcoin, though its shares have dropped over 70% from mid-year highs.
However, even Japan’s approach is facing pressure as MSCI Inc., a global index provider, is considering removing such companies from its indexes, saying they “may act more like investment funds.”
Also Read: Hong Kong Approves First solana Spot ETF Ahead of Global Race
