BRIEF: DMall prepares to apply for stablecoin license, stock soars

Retail software services provider DMall Inc. (2586.HK) announced on Thursday that it is preparing to apply for a Hong Kong stablecoin license, and has already purchased bitcoin in the public market via the HashKey Exchange using its existing cash reserves.

DMall said it signed a strategic cooperation agreement with HashKey Group in February, which will see the parties collaborate in key areas including digital asset trading, Web3 technology development and application, and blockchain ecosystem building. They will explore launching technology services, including stablecoin payments, and promotion of widespread use of stablecoins for retail payments.

DMall’s shares surged as much as nearly 90% on Thursday after the announcement, and closed up 23% at HK$11.14 as HK$1.8 billion ($230 million) in shares changed hands. The company went public in 2024 at HK$30.21 per share, but its stock crashed 54% on its first day of trading to close at HK$13.80. The downward trend continued, with the price falling to a low of HK$4.78. Despite the rebound, the stock is still down 63% from its IPO price.

DMall primarily provides a cloud-based digital retail SaaS platform for retailers. But its client base is highly concentrated, with nearly 90% of its business coming from companies affiliated with Wumei Group, which is controlled by major shareholder Zhang Wenzhong.

By Lee Shih Ta

To subscribe to Bamboo Works weekly free newsletter, click here