Digital asset exchange HashKey has revealed plans to list on the stock exchange, seeking to raise approximately $215 million through the upcoming HashKey IPO in Hong Kong. According to information broken down in the company’s official prospectus, this strategic move seeks to capitalize on its regulated status despite facing high monthly cash burn and significant accumulated losses derived from building its infrastructure.
The financial data presented is compelling and shows an aggressive expansion of the user base, going from fewer than 200 accounts in 2022 to more than 1.44 million by mid-2025. However, this accelerated growth has come at a high cost, reporting accumulated net losses of 3.0 billion Hong Kong dollars (approximately 386 million US dollars) during the same period.
Additionally, the company detailed that it burned an average of HK$40.9 million monthly in the third quarter, which evidences the high initial operating costs necessary to establish institutional-grade compliance and custody services.
Will the institutional focus manage to make the costly regulatory compliance infrastructure profitable?
The central argument HashKey presents to investors is based on the operating leverage allowed by a fully regulated market structure. The company maintains that many of its largest expenses, such as licensing and risk infrastructure, are fixed costs that do not scale linearly with trading activity, which will eventually improve margins.
Therefore, as client adoption increases, revenues linked to trading and management can expand much faster than expenses, creating a solid foundation for future profitability once the necessary critical scale is reached.
On the other hand, the document highlights a major tactical shift toward institutional flows, given that retail trading volumes fell in early 2025. The firm’s global platform, registered in Bermuda, was pared back as it lacked competitive local fiat channels, leading the company to focus on its licensed domestic platform.
This approach allows offering regulated on-ramp and off-ramp channels, linking more closely with ETF flows and traditional financial institutions, consolidating its position in the Asian market for digital assets.
The company estimates having more than 70 months of liquidity, backed by cash, digital assets, and expected proceeds from the public offering. Thus, HashKey prepares to navigate the cryptocurrency market with a long financial runway, betting that regulation will be the deciding factor. Market attention will now focus on whether the execution of this strategy will manage to balance the books before cash burn becomes a major obstacle.
