Hong Kong’s top VC firm approaches billionaires for $300 million Crypto funding

Amid the expanding crypto crackdown, Hong Kong Venture Capital giant, CMCC Global is launching yet another round for its crypto fund, aiming to accumulate $300 million this time around. Furthermore, the firm is reaching out to billionaire investors like Richard Li to bet on blockchain and Defi. Richard Li had already anchored CMCC’s last crypto funding round, in April which closed at nearly $90 million, through his investment manager Pacific Century Group.

“Martin and Charlie (CMCC founders) are able to get into crypto projects and get connected with the founders really early on, which makes them special,” said Daniel Wong, a senior vice president of Pacific Century Group.

Crypto Funds loophole

Hong Kong used to be a global crypto hub before the ban, however, the industry has found a loophole with crypto funds. They raise money for crypto, invest in crypto through that funding, and further issue shares against the bought crypto, with CMCC leading the industry in these crypto funding rounds. While the company’s majority stake in the venture is held by the founders, Martin Baumann, and Charlie Morris, who founded the company in 2016, Richard Li, along with the Gemini Trust Co. founders, Cameron and Tyler Winklevoss are also investors in CMCC’s holding entity.

“The underlying infrastructure is maturing to the point where we basically can have interesting applications…Particularly in Defi, we’ve seen higher quality teams.”, said Charlie Morris, who is one of the investors in the VC.

Hong Kong Crypto Industry fights back amid Crackdown

During the third quarter, the Securities and Futures Commission (SFC) of Hong Kong issued a notice, announcing a ban on CIS offerings to the public in Hong Kong without the SFC’s authorization. The commission further warned investors to be extra cautious if they still plan to go against the authorities and invest in an unauthorized investment scheme.

As the regulators are determined to close in on the crypto industry of Hong Kong, the crypto hub still has some fight left. Earlier this month, Powercrypto Holdings, a subsidiary of Powerbridge Technologies, announced the upcoming launch of a fleet of crypto miners for Bitcoin (BTC) and Ethereum (ETH) in Hong Kong. Furthermore, Powercrypto confirmed the eco-friendly and sustainable nature of its crypto mining operations to avoid the regulatory crackdown.