Meitu has reported losses of $17.3 million on its Bitcoin holdings, with its Ether investment having gained $14.7 million despite the recent crypto downturn.
Hong Kong tech company Meitu has taken a $17.3-million hit on its Bitcoin (BTC) holdings — but on the upside, its Ether (ETH) holdings have gained $14.7 million.
The developer of popular Photoshop-style apps spent a total of $100 million on BTC and ETH between March and April this year, acquiring a total of 940.89 BTC for $49.5 million and 31,000 ETH for $50.5 million.
According to a Tuesday voluntary announcement from Meitu, the fair value of its BTC and ETH holdings is based on the market prices as of June 30, which is the final day of the firm’s six-month interim results, in accordance with International Financial Reporting Standards.
As of the end of the second quarter on June 30, Meitu’s BTC holdings represented $32.2 million, and its ETH represented $65.2 million, marking an overall $2.6-million decrease from its initial $100-million investment.
The firm accounts crypto assets as “intangible assets under the cost model” in the interim results, and the BTC loss is expected to be recognized as “impairment loss”, while the ETH gains will not be recognized as “revaluation gain” until such time as it is sold.
The interim results have not changed the firm’s bullish sentiments toward crypto, with the announcement reiterating:
“The Board believes that the blockchain industry is still in its early stage and that cryptocurrencies have ample room for appreciation in value over the long-term.”
The report stated that due to the firm’s long-term view, “there are currently no plans to sell the same in the near future.”
Interestingly, the firm also provided an updated fair value of its ETH and BTC holdings as of Tuesday, which reveals an overall $5.2-million gain on its initial investment, with ETH representing $72.4 million and BTC up slightly to $32.8 million.
Related: Ether already ‘flippening’ Bitcoin, says Celsius CEO
Ether could gain even more if popular Crypto Twitter account CroissantEth is right with their thread containing 24 reasons why ETH is undervalued.
24 reasons $ETH is extremely undervalued...
A thread by
— croissant (@CroissantEth) July 7, 2021
Aside from the obvious use cases of ETH in smart contracts — decentralized finance and nonfungible tokens — and the upcoming EIP-1559 upgrade and eventual transition to Eth2, CroissantEth highlighted the fact that 94 out of the top 100 decentralized applications are built on the Ethereum network.
“These protocols often have many further use cases involving $ETH, creating the fundamentals for the Web 3.0 economy,” he said.
CroissantEth also points to the stablecoins that utilize the Ethereum network, citing Tether (USDT), USD Coin (USDC), MakerDao’s Dai and TrueUSD (TUSD), as he emphasized their multi-billion-dollar market caps and highlighted that USDC grew from a $4-billion market cap to $25 billion this year.
2. Stablecoins$ETH is home to many stablecoins which have grown tremendous use cases:$USDT: $62B$USDC: $25B$DAI: $5B$TUSD: $1.5B
They are very popular for use in DeFi, & VISA will soon accept tx settlement in $USDC$USDC has grown from a $4B mcap, to $25B this year pic.twitter.com/fP8gufNeAd
— croissant (@CroissantEth) July 7, 2021
Metaverses, gaming and digital land also get notable mentions, as he cites their massive growth potential, along with layer-two solutions and decentralized autonomous organizations to name a few.
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