Key Takeaways
- Major Asian exchanges in Hong Kong, India, and Australia are blocking listed companies from becoming crypto hoarders
- Regulators cite rules against “cash companies” with excessive liquid assets
- Japan remains the exception, hosting 14 listed Bitcoin buyers including Metaplanet
- MSCI proposes excluding large crypto hoarders from global indexes
Asia’s largest stock exchanges are cracking down on listed companies attempting to transform into digital-asset treasury vehicles, threatening a business model that fueled Bitcoin’s rally to record highs.
Regulatory Pushback Across Major Markets
Hong Kong Exchanges & Clearing has challenged at least five firms seeking to pivot to crypto accumulation as their core business. None have received approval, with regulators citing rules prohibiting companies from maintaining large liquid holdings.
Similar resistance has emerged in India and Australia. The Bombay Stock Exchange recently rejected Jetking Infotrain’s application after the company proposed investing in cryptocurrency. In Australia, ASX Ltd.’s rules bar listed firms from holding 50% or more of their balance sheets in cash or cash-like assets.
“Listing regulations directly shape how fast and how cleanly a digital-asset treasury model can operate,” said Rick Maeda, a Tokyo-based crypto analyst at Presto Research.
The Cash Company Problem
In Hong Kong, publicly traded firms with assets primarily in cash or short-term investments face suspension as “cash companies.” This aims to prevent shell companies from trading their listed status for money.
Simon Hawkins, partner at Latham & Watkins, explained success depends on whether firms “demonstrate that acquiring crypto assets is part and parcel of their operating business.” Transitioning to pure-play crypto accumulation remains forbidden for listed companies in Hong Kong.
Japan’s Crypto-Friendly Exception
Japan stands apart in Asia-Pacific, allowing public companies substantial freedom to hold cash and pursue crypto strategies. The nation hosts 14 listed Bitcoin buyers, the most in Asia.
“Once a company is listed, if it makes appropriate disclosures — for example, disclosing that it is purchasing Bitcoin — it would be quite difficult to immediately conclude that such actions are unacceptable,” said Hiromi Yamaji, CEO of Japan Exchange Group.
Hotel chain Metaplanet Inc. became an early adopter, accumulating a $3.3 billion Bitcoin cache. However, its shares have fallen over 70% from their June peak, highlighting the volatility of the strategy.
Growing Institutional Scrutiny
MSCI Inc., a major index provider, recently proposed excluding large crypto hoarders from global indexes. The move followed Metaplanet’s $1.4 billion equity sale, with most proceeds directed toward Bitcoin purchases.
The company suggested banning firms whose crypto holdings represent 50% or more of total assets, noting DATs “may exhibit characteristics similar to investment funds,” which are ineligible for MSCI indexes.
Japan equity analyst Travis Lundy warned exclusion “could kill the premium to book argument” by cutting off passive inflows from index-tracking funds.
The coordinated regulatory pushback comes as DAT purchases slow and share prices decline, with retail investors estimated to have lost $17 billion in DAT trades amid wider crypto market selloffs.
