In early 2021, while the world watched Tesla make headlines for investing $1.5 billion in Bitcoin, another surprising player entered the crypto spotlight: Meitu, the Chinese photo-editing giant best known for its beauty-focused apps. What started as a bold strategic move quickly turned into a cautionary tale of volatility, risk, and the unpredictable nature of digital assets.
This is the story of how a company celebrated for selfies and filters ventured into the high-stakes world of cryptocurrency — and what happened when the market turned.
Meitu’s $100 Million Crypto Gamble
In March 2021, Meitu officially announced its entry into the cryptocurrency market, marking a major pivot from its core software business. Over three purchases by early April, the company invested approximately $100 million in digital assets, acquiring:
- 940.885 Bitcoin (BTC)
- 31,000 Ethereum (ETH)
These weren't small speculative trades — they represented a significant portion of Meitu’s available capital. In fact, the investment amount was nearly equivalent to the company’s full-year gross profit in 2020, highlighting just how aggressive this strategy was.
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At the time, the decision seemed visionary. On April 13, Bitcoin surged past $63,000**, and Ethereum broke **$2,200. At peak valuation, Meitu’s holdings had appreciated by an estimated $27.5 million — roughly 177 million RMB — turning what many saw as a risky bet into a short-term win.
For context, Meitu’s adjusted net profit for all of 2020 was only 60.9 million RMB. In just weeks, crypto gains nearly tripled their annual profitability.
The Fall: When Gains Vanished Overnight
But as any seasoned investor knows, crypto markets are fickle. By May 2021, regulatory fears, environmental concerns over mining, and broader market corrections sent Bitcoin plunging below $40,000. Ethereum followed suit.
The result? Meitu’s paper profits evaporated — and then reversed.
According to reports from cnBeta, the company shifted from a $2.75 million gain** to a **$2.02 million loss — around 13 million RMB in unrealized losses. A stunning reversal in just over a month.
While not catastrophic in absolute terms, the swing raised serious questions about corporate governance, risk management, and whether tech companies should be using shareholder capital for speculative digital asset plays.
Why Did Meitu Take the Leap?
Meitu didn’t act in a vacuum. The decision was heavily influenced by its founder, Cai Wensheng, a well-known advocate of blockchain technology and early crypto adopter.
Shortly after the first purchase, Cai posted on social media:
“Meitu is expanding its blockchain strategy. Buying ETH and BTC is part of our long-term value reserve plan. Someone has to be first. This might be the first Hong Kong-listed company to buy Bitcoin — and possibly the first globally to hold Ethereum as a treasury reserve.”
His vision was clear: treat crypto not just as an investment, but as a strategic reserve asset, similar to how corporations hold gold or foreign currencies.
The logic follows a growing global trend — one led by companies like MicroStrategy and Tesla — that view Bitcoin as "digital gold" and a hedge against inflation and fiat devaluation.
Strategic Intent vs. Market Reality
Meitu framed its crypto purchases as part of a broader treasury diversification strategy. Their official statement emphasized:
“Given the increasing depreciation of global fiat currencies due to monetary easing, we believe cryptocurrencies like Bitcoin and Ethereum offer substantial long-term appreciation potential.”
They planned to allocate a portion of their cash reserves to digital assets to mitigate traditional financial risks.
But execution diverged from theory. Unlike MicroStrategy, which has a dedicated team and structured buying strategy, Meitu appeared to enter the market rapidly and at price peaks — increasing exposure to downside risk.
Moreover, unlike Tesla — which later sold part of its BTC holdings at a profit — Meitu held through the crash, turning short-term volatility into sustained paper losses.
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Core Lessons from Meitu’s Crypto Move
Several key takeaways emerge from this episode:
1. Timing Matters
Buying near all-time highs magnifies downside risk. Dollar-cost averaging could have reduced exposure to volatility.
2. Transparency Builds Trust
Investors demanded clarity on risk exposure, accounting treatment, and exit strategies — areas where Meitu offered limited detail.
3. Corporate Strategy Must Align with Core Business
Diversifying cash reserves is valid, but straying too far from core operations can confuse stakeholders and dilute brand value.
4. Leadership Enthusiasm ≠ Sound Investment Policy
While founder passion drives innovation, it must be balanced with governance and risk controls.
How Does This Compare to Other Corporate Crypto Investments?
Meitu wasn’t alone. In 2021, several public companies explored crypto treasuries:
- Tesla: Bought $1.5B BTC in Q1 2021; later sold 75% at a profit.
- MicroStrategy: Holds over 200,000 BTC; treats it as primary treasury asset.
- Square (now Block): Early BTC investor; maintains small but strategic holdings.
What sets Meitu apart is both the speed of entry and the proportion of capital deployed relative to its size and profitability.
While larger firms had deeper pockets and risk buffers, Meitu’s move was more akin to a startup betting its runway on a single trade.
Frequently Asked Questions (FAQ)
Q: Did Meitu actually sell any of its crypto holdings?
A: As of mid-2021 reports, Meitu had not sold any Bitcoin or Ethereum. The losses were unrealized (paper losses), meaning they remained in their portfolio.
Q: Is Meitu still holding crypto today?
A: While official updates are limited post-2021, regulatory scrutiny in China and market conditions likely discouraged further activity. No major purchases have been reported since.
Q: Was Meitu the first company to buy Ethereum as a treasury asset?
A: While not definitively proven, Meitu was among the first public companies globally to explicitly state Ethereum as part of its long-term reserve strategy.
Q: How did investors react to Meitu’s crypto investment?
A: Mixed. Some praised forward-thinking; others criticized poor timing and lack of risk disclosure. Share price fluctuated with crypto markets.
Q: Could this happen again in 2025?
A: With renewed bull market momentum and institutional adoption rising, more companies may explore crypto treasuries — but likely with stricter frameworks.
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Final Thoughts: Innovation or Overreach?
Meitu’s crypto journey reflects a broader tension in the digital economy: balancing innovation with prudence.
On one hand, embracing emerging technologies can position companies for future relevance. On the other, speculative moves without robust strategy can damage credibility and erode value.
For now, Meitu’s story serves as both inspiration and warning — a reminder that in the fast-moving world of blockchain and digital finance, vision must be matched with discipline.
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