Tight Regulation of Crypto Assets in Asian Stock Exchanges

Major stock exchanges in the Asia-Pacific region have begun to oppose companies holding significant amounts of crypto assets on their balance sheets. Exchanges in countries such as Hong Kong, Australia, and India are taking restrictive measures against companies pursuing a digital asset treasury (Digital Asset Treasury – DAT) strategy.

According to the report, the Hong Kong Stock Exchange (HKEX) has intervened with at least five companies planning to hold large amounts of crypto assets on their balance sheets. The exchange requested these companies to justify their crypto purchases and reminded them that existing regulations include restrictions on holding “highly liquid assets.”

The Bombay Stock Exchange in India has also taken a similar stance by rejecting education company Jetking Infotrain's plan to invest part of the funds raised from a capital increase into crypto. The Australian Stock Exchange (ASX) prohibits companies from holding more than 50% of their balance sheets in cash or cash-like assets.

In contrast, Australian software firm Locate Technologies holds 12.3 Bitcoin (approximately $1.33 million) on its balance sheet and plans to switch to the New Zealand Stock Exchange (NZX) because of this. The company's CEO, Steve Orenstein, stated that the regulations hinder their crypto strategies. However, this year, many publicly traded companies around the world have started to adopt crypto as a reserve asset, as seen in the cases of MicroStrategy and Metaplanet.

Japan, on the other hand, is taking a more flexible approach to this issue. As one of the exceptions in the region, Japan is more open to DAT strategies. Hiromi Yamaji, CEO of the Japan Exchange Group, stated in September that “once a company goes public, for example, if it publicly announces that it has purchased Bitcoin, it is difficult to immediately regard such steps as inappropriate.” This approach makes Japan one of the freest markets in the region in terms of integrating crypto into corporate balance sheets, as seen in the case of Metaplanet.