The Hong Kong Exchanges and Clearing Limited (00388) tightens regulation on cryptocurrency treasury companies and has rejected some companies from shifting their core businesses to Decentralized Autonomous Trusts (DAT).

According to media reports, HKEX (00388) is resisting cryptocurrency hoarding platforms disguised as listed companies. The Hong Kong Stock Exchange has raised questions about the plans of at least 5 companies, who have recently sought to shift towards Digital Asset Treasury (DAT, cryptocurrency reserves) as their core business in the past few months. Currently, these companies have not been approved. Sources say that the main reason for HKEX's skepticism is citing rules against "shell companies" aimed at restricting entities from going public primarily holding liquid assets. A spokesperson for the Hong Kong Stock Exchange refused to comment on specific companies facing their questioning, but stated that their framework ensures all applicants seeking listing and those already listed have viable, sustainable, and substantive businesses and operations. This trend is not unique to Hong Kong. So-called DAT has faced similar opposition in India and Australia. Last month, the Mumbai Stock Exchange rejected a company's listing application after the company announced plans to invest the raised funds in cryptocurrency. Meanwhile in Australia, the rules of the Australian Stock Exchange (ASX) prohibit listed companies from allocating more than half of their balance sheet to cash assets (including cryptocurrency), making the business model of digital asset treasuries "essentially impossible" to achieve. The direct consequence of these regulatory actions is that the market performance of such companies has been significantly under pressure. As the cryptocurrency market has experienced a significant correction recently, the stock prices of many digital asset treasury companies have continued to decline, and some have even fallen below their net asset values (NAV), raising doubts among investors about the sustainability of their business model.