Chinese app Meitu buys millions worth of bitcoin and ethereum

Bill Mount

The interface of the app Meitu is displayed on a mobile phone in Yichang, central China’s Hubei province, Feb 22, 2021. Costfoto | Barcroft Media | Getty Images Meitu, a Chinese company that makes a photo editing app, has purchased bitcoin and ether, becoming the latest firm to buy cryptocurrencies. […]

The interface of the app Meitu is displayed on a mobile phone in Yichang, central China’s Hubei province, Feb 22, 2021.

Costfoto | Barcroft Media | Getty Images

Meitu, a Chinese company that makes a photo editing app, has purchased bitcoin and ether, becoming the latest firm to buy cryptocurrencies.

The Hong Kong-listed company said on Sunday it bought $22.1 million worth of ether and $17.9 million worth of bitcoin on March 5.

Meitu follows the likes of electric car company Tesla and Square in purchasing bitcoin. But the Chinese appmaker appears to be the first major company to buy ether, a cryptocurrency that works on the ethereum blockchain.

Bitcoin is based on its own blockchain, the technology that underpins it.

Ethereum is a completely different network. It’s an open-source blockchain that allows developers to build apps on top of it. The cryptocurrency ether can be used to pay or interact with services built on top of the ethereum network. These are often called decentralized applications or dApps.

Meitu said in a statement that “blockchain technology has the potential to disrupt both existing financial and technology industries, similar to the manner in which mobile internet has disrupted the PC internet and many other offline industries.”

“The Board believes cryptocurrencies have ample room for appreciation in value and by allocating part of its treasury in cryptocurrencies can also serve as a diversification to holding cash (which is subject to depreciation pressure due to aggressive increases in money supply by central banks globally) in treasury management,” Meitu said.

The move demonstrates to investors that Meitu “has the vision and determination to embrace technological evolution, and hence preparing its foray into the blockchain industry,” Meitu said.

Shares of Meitu were 3.3% higher at 1:44 p.m. Hong Kong time after popping over 14% earlier in the day.

Meitu noted that cryptocurrency prices are “still highly volatile.”

The company said it is “evaluating the feasibility of integrating blockchain technologies to its various overseas businesses” including potentially launching ethereum-based apps or investing into other blockchain businesses.

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