Huobi founder Li Lin is moving his private trading operations into a publicly listed Hong Kong vehicle, Bitfire Group, which aims to attract over $760 million for a new bitcoin-denominated asset management product.
"Market demand for such products is huge," Livio Weng, chief executive of Bitfire, said in an interview, noting that a growing number of local firms holding bitcoin lack ways to generate returns from their assets.
Bitfire, a wealth management firm where Li is the largest shareholder, will acquire the investment team and trading systems from his family office, Avenir Group, for $1.6 million. The new "Alpha BTC" strategy intends to use derivatives like options, with bitcoin or spot ETFs such as BlackRock's IBIT as the underlying asset, to generate profit.
The move positions Bitfire to capitalize on Hong Kong's push to become a regulated crypto hub, directly targeting an estimated 40 listed companies in the city that already hold bitcoin on their balance sheets. It also marks a significant strategic shift for Li, who sold his controlling stake in the Huobi exchange in 2022 after mainland China banned cryptocurrency trading.
While China maintains its crypto ban, Hong Kong is actively creating a regulated ecosystem for digital assets. The city recently granted its first licenses for stablecoin issuers and is advancing rules for crypto dealers and custodians, signaling a clear intent to attract international virtual asset businesses.
This contrasts with the legislative gridlock in the United States, where bills to regulate stablecoins and market structure have stalled. At a recent Web3 event, Hong Kong lawmaker Duncan Chiu Tat-kun noted the "steady progressive build-up" in the city's digital asset regulation compared to the political uncertainty in Washington. Bitfire's new fund is designed to operate within this emerging Hong Kong framework, offering a compliant vehicle for institutions to gain yield on their crypto holdings.
This article is for informational purposes only and does not constitute investment advice.
