51% of Bitcoin Mining Company Diginex Acquired by Hong Kong-based Alcohol Company

May 01 2018

Though the Chinese government has banned all things crypto, the lure of profits within this space is tempting the Chinese companies to invest in them, even if through the Hong Kong route.

A multinational crypto-asset investment company, Diginex Limited, based out of Hong Kong announced a 51% stake sale in its cryptocurrency mining and high-performance computing (HPC) operations for a sum of $60 million to Madison Group Holdings (HKG: 8057). The two companies have signed a Memorandum of Understanding (MoU) between two companies with details of the expected synergies between the two platforms. The Madison Group hopes clients and cryptocurrency users can use the Diginex’s proprietary platform Digiassets to be able to purchase high-value wines and other assets.

Formerly, known as Madison Wine, Madison Holdings Group is an investment company with a spectrum of alcoholic beverage businesses for retail and wholesale business. A wide array of fine wines, wine products other spirits such as premium and rare whiskeys, cognacs and Chinese baijiu are supplied in Hong Kong. The company Madison is also listed on the Hong Kong Stock Exchange since 2015.

Mining Farms in Asia, Sweden, and Switzerland

Diginex is a privately owned firm with offices in Hong Kong, Switzerland, Germany, and Japan. It has mining operations in Asia, Switzerland, and Sweden. The proceeds from the $60 million stake purchase will help in the expansion of mining operations in Western Europe along with other stakeholders such as power and security providers, hardware providers which contribute to an efficient and secure GPU based cryptocurrency mining data centre.

As CEO of Diginex, Miles Pelham, stated,

“this cash injection allows us to expedite our steps towards becoming the global provider of Distributed Ledger Technologies. We will continue to build out our mining operations in Sweden and Switzerland, but also focus on helping corporates and governments across the world to implement transformative DLT applications.”

Re-directed Investments

China had banned ICOs in September 2017 and had subsequently banned trading in cryptocurrencies via the official fiat currency, the Yuan. It has now moved its eyes on cryptocurrency mining as the next culprit. Interestingly a year ago, China was home to almost 70 to 80 % of bitcoin mining across the world. That status stands in danger with China confiscating over 600 computers and other associated hardware related to mining, from the Tianjin area.

Ironically, on the other hand, one of the main mining companies Halong Mining based in China along with Bitmain are the biggest clients for Samsung and TSMC respectively.

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