The Meitu app interface is displayed on a cell phone in Yichang, Hubei province, in central China, on February 22, 2021.
Costfoto | Barcroft Media | Getty Images
Meitu, a Chinese company that makes a photo editing app, bought bitcoin and ether, becoming the latest company to buy cryptocurrencies.
The Hong Kong-listed company said on Sunday that it bought $ 22.1 million in ether and $ 17.9 million in bitcoin on March 5.
Meitu follows companies like Tesla and Square to buy bitcoins. 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 is an open source blockchain that allows developers to build applications on it. The ether cryptocurrency can be used to pay for or interact with services created on the ethereum network. They are often referred to as decentralized applications or dApps.
Meitu said in a statement that “blockchain technology has the potential to disrupt the existing financial and technology sectors, similar to the way the mobile internet has disrupted the PC internet and many other offline sectors.”
“The Board believes that cryptocurrencies have ample room for appreciation and, by allocating part of its treasury in cryptocurrencies, it can also serve as a diversification to maintain cash (which is subject to depreciation pressure due to aggressive increases in the money supply by central banks worldwide) in treasury management, “said Meitu.
The change demonstrates to investors that Meitu “has the vision and determination to embrace technological developments and therefore prepare for its foray into the blockchain industry,” said Meitu.
Meitu’s shares were 3.3% higher at 1:44 pm Hong Kong time, after bursting more than 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 into its various businesses abroad”, including potentially launching ethereum-based applications or investing in other blockchain businesses.