In the summer of 2025, Huaxing Capital announced a partnership with YZi Labs (formerly Binance Labs), planning to allocate $100 million to BNB. This followed a previously approved $100 million budget to enter the Web3 and cryptocurrency space, signaling a strategic shift from traditional internet services to digital assets.

Background & Challenges
Huaxing Capital once dominated China’s internet M&A as a "super facilitator," but antitrust policies and market changes have eroded its traditional business model. Revenue and net profit plummeted in 2022, and its reliance on guanxi (relationships) and information asymmetry struggles in Web3’s transparent environment.

Web3 History
Huaxing invested in crypto projects like Circle as early as 2018 but primarily earned fees from financing services rather than超额 returns. After Bao Fan’s disappearance in 2024, new leadership launched "Huaxing 2.0," focusing on hard tech and Web3, aligning with Hong Kong’s pro-digital asset policies.

Strategic Motivation
By allocating to assets like BNB, Huaxing aims to bridge Web2 and Web3, replicating its internet-era success. Externally, it offers traditional institutions crypto exposure; internally, it seeks to capture new financing and M&A demand.

Risks & Challenges
Crypto markets are rife with narrative traps in primary investments and require expertise in secondary trading. The FA model fails in on-chain transparency, and reputational risks are high (e.g., Temasek’s losses from FTX). Huaxing must redefine its value in a disintermediated world.

Future Path
Huaxing must find new strengths in investing, trading, or services but faces cognitive restructuring and vested interest conflicts. No traditional financial institution has significantly succeeded in digital asset转型, making Huaxing’s move a high-stakes gamble.

Summary
Author: Ada, Deep Chao TechFlow

In the summer of 2025, Huaxing Capital regained market attention by signing a memorandum with YZi Labs (formerly Binance Labs) to invest $100 million in BNB. Just two months prior, its board had approved a similar budget for Web3 and crypto, sparking speculation about a deep transformation or even self-reinvention.

In China’s investment banking landscape, Huaxing has always been unique: lacking the state-backed roots of CICC or CITIC, or the century-long legacy of Goldman Sachs and Morgan Stanley. Its growth mirrored China’s internet explosion. Since its 2005 founding, Huaxing facilitated landmark deals like Didi-Kuaidi, Meituan-Dianping, and 58-Ganji mergers. Without that decade of internet wild growth, Huaxing might never have become the "M&A King."

But as tides receded, internet economies shifted from growth to stock competition, and antitrust policies tightened, Huaxing’s foundation crumbled. The once-glamorous boutique bank now faces unprecedented challenges.

Is entering Web3 Huaxing’s self-redemption or the collective fate of traditional投行 in the digital age?

The M&A King’s Dilemma
In 2021, Huaxing delivered a stellar performance: revenue of RMB 2.504 billion and net profit of RMB 1.624 billion, up 56.5% YoY, driven by projects like Ideal Auto’s HK IPO and Kuaishou’s listing. Bao Fan wrote excitedly in the annual report: "We stand at the dawn of the next decade for the new economy."

But peaks often precede declines. In 2022, revenue fell 8.36% to RMB 1.533 billion, and net loss hit RMB 564 million, down 134.71% YoY. This reflected a broader cooling: national M&A transaction volume dropped 23.5%, with TMT sectors plunging 41%. For Huaxing, built on TMT M&A, this was existential.

The deeper crisis, however, wasn’t in the data but the model. Huaxing thrived in China’s internet gold rush, where startups scaled rapidly, giants acquired赛道, and capital loved narratives. As the "super facilitator," Bao Fan’s charisma, networks, and industry insight formed Huaxing’s moat.

But when the environment reversed, the model faltered. Stock competition replaced growth, and "strong alliances" became regulatory red lines. Centralized networks, closed information, and relationship-driven value creation clashed with a new world prioritizing transparency, openness, and disintermediation.

As Reuters quoted a Bao Fan acquaintance: Huaxing remained a "one-man business, key-person focus" model, unsustainable in the new era.

Covert Web3 Moves
Huaxing’s Web3 exploration wasn’t impulsive.

In May 2018, Circle raised $110 million in Series E funding from investors like IDG, Breyer Capital, and Bitmain. Few noticed Huaxing among them. Until Huaxing’s congratulatory note in June 2025, outsiders hardly knew it had entered the stablecoin race. Circle’s IPO filing didn’t list Huaxing as a major shareholder, suggesting limited stakes or pre-IPO exits.

Still, hitting Circle excited investors. As a "Circle concept stock," Huaxing’s share price surged over 100% from HK$3 to HK$6+, a booster for a long-declining listed company.

Huaxing’s Circle investment stemmed from Bao Fan’s foresight. In 2015, at Huaxing’s peak, he unexpectedly warned: "We might be out of business in three years." That sparked Huaxing’s transformation—from service provider to participant, advisor to shareholder.

In Huaxing’s portfolio, Circle wasn’t standout compared to Meituan, JD Digits, Kuaishou, Li Auto, NIO, or Pop Mart. An encrypted payment U.S. firm seemed "non-mainstream," and lead investor Lei Ming admitted luck played a role. Huaxing entered late with small shares, hardly making big money.

Beyond Circle, Huaxing left other crypto footprints: direct investments in Amber Group, Matrixport; advisory roles for Canaan, Bitdeer, HashKey; even appointing blockchain veteran Frank Fu Kan as independent non-executive director.

But these efforts didn’t yield bright业绩. Per 36Kr, Huaxing earned more from financing services than超额 returns in crypto. Circle’s value lay more in imagination and market cap repair.

Post-Bao Fan Gamble
In 2024, Huaxing got new leadership.

After Bao Fan’s disappearance, his wife Xu Yanqing stepped up, former CEO Xie Yijing exited, and a triumvirate formed with Xu as chair, Wang Lixing as CEO, and Du Yongbo as executive director. Xu proposed "Huaxing 2.0": reducing reliance on traditional internet businesses, betting on hard tech, Web3, and digital finance.

This pivot wasn’t whimsical but policy-timed. In May 2025, Hong Kong passed the Stablecoin Bill; a month later, the government issued the Digital Asset Development Policy Declaration 2.0. Almost simultaneously, Huaxing announced its $100 million Web3 entry.

It smelled familiar. Past Huaxing rode era trends to help Chinese internet companies win a wild decade; now, it aimed to replicate that on a new track—without Bao Fan.

In August, Huaxing partnered with YZi Labs to allocate $100 million to BNB, becoming the first HK-listed company to include BNB in digital asset allocations. Markets quickly dubbed it the "BNB MicroStrategy of港股."

Buying coins was step one. Huaxing planned two further BNB ecosystem empowerments:

1. Developing fund products with Huatai Fund (HK) and partners, promoting BNB listing on HK compliant virtual asset exchanges. Notably, on September 3, OSL became HK’s first exchange to offer BNB trading for professional investors.

2. Setting up a hundreds-of-millions-dollar RWA fund with YZi Labs, promoting BNB chain in HK-listed company stablecoin and RWA applications.

Behind these moves, Huaxing leveraged Binance’s momentum to join Web3’s core players.

On August 29, at BNB Chain’s fifth anniversary, Xu Yanqing told YZi Labs head Ella Zhang: "Since our partnership, we’ve received massive inquiries from traditional institutions. They no longer ask ‘why digital assets?’ but ‘how to properly allocate core assets like BNB representing future finance.’"

She emphasized: "Huaxing won’t just bridge Web2 and Web3; through our investment banking, asset management, and wealth management expertise, we’ll lead as Web3’s most iconic投行."

In short, Huaxing’s logic is clear:

• External: Traditional institutions seek crypto exposure with lower risk via Huaxing stock.

• Internal: Web3-Web2 fusion will spawn new financing and M&A demand, replaying the "internet M&A decade."

Huaxing wants to remain the "top投行" shaping markets—but in crypto.

The vision is grand, but reality bites.

Transformation Dilemmas
As a boutique投行 built on TMT M&A, Huaxing’s core strengths are deep internet insights and founder resources.

In traditional投行, incentives are clear: commissions, short-term业绩, quick results. Employees are "professional service providers" closing deals for fees.

For Huaxing, entering crypto means facing a harsh reality: even top traditional capitals have stumbled here.

First, the FA model is doomed.
In internet M&A’s heyday, Huaxing thrived on networks and information asymmetry: who raised funds, who sold, at what valuation—only a few投行 knew. In on-chain worlds, capital flows, governance votes, and protocol data are nearly fully transparent, trackable in real-time by anyone. Except for some Asian exchanges or asset managers needing FA help, most projects’ capital actions resemble "pooled investments," or even platforms like Hyperliquid never needing external funding.投行 pricing and facilitation advantages fade.

Thus, to earn超额 returns, Huaxing must invest directly.

"FA mainly builds connections; investing makes money," some FA practitioners explored crypto with this mindset. After making friends and investing, they successfully lost money.

Crypto primary markets are extremely perilous. Good investment requires deep understanding of crypto’s底层 logic and connections with top entrepreneurs for continuous empowerment.

But币圈 floods with short-term narrative traps: a project hitting trends might soar in months; post-narrative, market caps halve, teams lack business models, survive by selling coins, and prices keep falling. Moreover, markets now distrust altcoins, focusing funds on BTC, ETH, SOL等头部 assets. Even popular stock-token联动 models may be disproven someday.

For Huaxing, this means two-layer risks:

1. Investment vision能否穿透 narrative traps.

2. Reputation risks.

Crypto cycles change faster than traditional markets. A protocol hack or project rug pull can destroy market cap in 48 hours. If Huaxing steps on mines, it loses not just funds but hard-earned "boutique投行"口碑.

Singapore’s state fund Temasek not only lost ~$275 million in FTX but, as a state-backed investor, faced parliamentary queries, admitting "major due diligence omissions," severely damaging reputation.

From this perspective, Huaxing’s best path isn’t recreating a crypto "M&A King" but becoming a large secondary market player. Strategically allocating to core assets like BTC, ETH, BNB, plus quantitative strategies and risk hedging, could pursue steady returns.

But this road is equally treacherous.

Trading means competing with countless professional quant funds, crypto-native trading teams, and multinational market makers. Without deep technical skills, risk control systems, and on-chain data insights, traditional投行 brand and networks hardly build real advantages.

Huaxing is in an awkward position:

• FA: information advantage gone.

• VC: narrative traps everywhere.

• Secondary: lacking native genes.

This dilemma faces many traditional FA/VCs in crypto. To立足 Web3, it takes not just capital but complete cognitive restructuring.

It must answer: in this transparent, disintermediated world, what is Huaxing’s value?

Looking back from 2025, Huaxing’s Web3 transformation resembles a forced experiment. Not active choice but being cornered by environment.

20 years ago, Huaxing rose by catching China’s internet takeoff window. Then, Bao Fan challenged with sharpness, tearing old finance gaps with "internet-savvy投行."

Today’s situation differs: Web3 isn’t moving offline业务 online but rewriting financial logic entirely: decentralization, permissionlessness, community governance—these ideas shake投行’s intermediary survival foundation.

Role shifts sharpen problems. Past Huaxing was a startup, traveling light; present Huaxing is vested interest, "all-in" new tracks meaning abandonment and betrayal. For an institution written into China’s M&A history, this choice is crueler than two decades ago.

But for Huaxing, there’s no turning back.

In the summer of 2025, Huaxing Capital announced a partnership with YZi Labs (formerly Binance Labs), planning to allocate $100 million to BNB. This followed a previously approved $100 million budget to enter the Web3 and cryptocurrency space, signaling a strategic shift from traditional internet services to digital assets.

Background & Challenges
Huaxing Capital once dominated China’s internet M&A as a "super facilitator," but antitrust policies and market changes have eroded its traditional business model. Revenue and net profit plummeted in 2022, and its reliance on guanxi (relationships) and information asymmetry struggles in Web3’s transparent environment.

Web3 History
Huaxing invested in crypto projects like Circle as early as 2018 but primarily earned fees from financing services rather than超额 returns. After Bao Fan’s disappearance in 2024, new leadership launched "Huaxing 2.0," focusing on hard tech and Web3, aligning with Hong Kong’s pro-digital asset policies.

Strategic Motivation
By allocating to assets like BNB, Huaxing aims to bridge Web2 and Web3, replicating its internet-era success. Externally, it offers traditional institutions crypto exposure; internally, it seeks to capture new financing and M&A demand.

Risks & Challenges
Crypto markets are rife with narrative traps in primary investments and require expertise in secondary trading. The FA model fails in on-chain transparency, and reputational risks are high (e.g., Temasek’s losses from FTX). Huaxing must redefine its value in a disintermediated world.

Future Path
Huaxing must find new strengths in investing, trading, or services but faces cognitive restructuring and vested interest conflicts. No traditional financial institution has significantly succeeded in digital asset转型, making Huaxing’s move a high-stakes gamble.

Summary
Author: Ada, Deep Chao TechFlow

In the summer of 2025, Huaxing Capital regained market attention by signing a memorandum with YZi Labs (formerly Binance Labs) to invest $100 million in BNB. Just two months prior, its board had approved a similar budget for Web3 and crypto, sparking speculation about a deep transformation or even self-reinvention.

In China’s investment banking landscape, Huaxing has always been unique: lacking the state-backed roots of CICC or CITIC, or the century-long legacy of Goldman Sachs and Morgan Stanley. Its growth mirrored China’s internet explosion. Since its 2005 founding, Huaxing facilitated landmark deals like Didi-Kuaidi, Meituan-Dianping, and 58-Ganji mergers. Without that decade of internet wild growth, Huaxing might never have become the "M&A King."

But as tides receded, internet economies shifted from growth to stock competition, and antitrust policies tightened, Huaxing’s foundation crumbled. The once-glamorous boutique bank now faces unprecedented challenges.

Is entering Web3 Huaxing’s self-redemption or the collective fate of traditional投行 in the digital age?

The M&A King’s Dilemma
In 2021, Huaxing delivered a stellar performance: revenue of RMB 2.504 billion and net profit of RMB 1.624 billion, up 56.5% YoY, driven by projects like Ideal Auto’s HK IPO and Kuaishou’s listing. Bao Fan wrote excitedly in the annual report: "We stand at the dawn of the next decade for the new economy."

But peaks often precede declines. In 2022, revenue fell 8.36% to RMB 1.533 billion, and net loss hit RMB 564 million, down 134.71% YoY. This reflected a broader cooling: national M&A transaction volume dropped 23.5%, with TMT sectors plunging 41%. For Huaxing, built on TMT M&A, this was existential.

The deeper crisis, however, wasn’t in the data but the model. Huaxing thrived in China’s internet gold rush, where startups scaled rapidly, giants acquired赛道, and capital loved narratives. As the "super facilitator," Bao Fan’s charisma, networks, and industry insight formed Huaxing’s moat.

But when the environment reversed, the model faltered. Stock competition replaced growth, and "strong alliances" became regulatory red lines. Centralized networks, closed information, and relationship-driven value creation clashed with a new world prioritizing transparency, openness, and disintermediation.

As Reuters quoted a Bao Fan acquaintance: Huaxing remained a "one-man business, key-person focus" model, unsustainable in the new era.

Covert Web3 Moves
Huaxing’s Web3 exploration wasn’t impulsive.

In May 2018, Circle raised $110 million in Series E funding from investors like IDG, Breyer Capital, and Bitmain. Few noticed Huaxing among them. Until Huaxing’s congratulatory note in June 2025, outsiders hardly knew it had entered the stablecoin race. Circle’s IPO filing didn’t list Huaxing as a major shareholder, suggesting limited stakes or pre-IPO exits.

Still, hitting Circle excited investors. As a "Circle concept stock," Huaxing’s share price surged over 100% from HK$3 to HK$6+, a booster for a long-declining listed company.

Huaxing’s Circle investment stemmed from Bao Fan’s foresight. In 2015, at Huaxing’s peak, he unexpectedly warned: "We might be out of business in three years." That sparked Huaxing’s transformation—from service provider to participant, advisor to shareholder.

In Huaxing’s portfolio, Circle wasn’t standout compared to Meituan, JD Digits, Kuaishou, Li Auto, NIO, or Pop Mart. An encrypted payment U.S. firm seemed "non-mainstream," and lead investor Lei Ming admitted luck played a role. Huaxing entered late with small shares, hardly making big money.

Beyond Circle, Huaxing left other crypto footprints: direct investments in Amber Group, Matrixport; advisory roles for Canaan, Bitdeer, HashKey; even appointing blockchain veteran Frank Fu Kan as independent non-executive director.

But these efforts didn’t yield bright业绩. Per 36Kr, Huaxing earned more from financing services than超额 returns in crypto. Circle’s value lay more in imagination and market cap repair.

Post-Bao Fan Gamble
In 2024, Huaxing got new leadership.

After Bao Fan’s disappearance, his wife Xu Yanqing stepped up, former CEO Xie Yijing exited, and a triumvirate formed with Xu as chair, Wang Lixing as CEO, and Du Yongbo as executive director. Xu proposed "Huaxing 2.0": reducing reliance on traditional internet businesses, betting on hard tech, Web3, and digital finance.

This pivot wasn’t whimsical but policy-timed. In May 2025, Hong Kong passed the Stablecoin Bill; a month later, the government issued the Digital Asset Development Policy Declaration 2.0. Almost simultaneously, Huaxing announced its $100 million Web3 entry.

It smelled familiar. Past Huaxing rode era trends to help Chinese internet companies win a wild decade; now, it aimed to replicate that on a new track—without Bao Fan.

In August, Huaxing partnered with YZi Labs to allocate $100 million to BNB, becoming the first HK-listed company to include BNB in digital asset allocations. Markets quickly dubbed it the "BNB MicroStrategy of港股."

Buying coins was step one. Huaxing planned two further BNB ecosystem empowerments:

1. Developing fund products with Huatai Fund (HK) and partners, promoting BNB listing on HK compliant virtual asset exchanges. Notably, on September 3, OSL became HK’s first exchange to offer BNB trading for professional investors.

2. Setting up a hundreds-of-millions-dollar RWA fund with YZi Labs, promoting BNB chain in HK-listed company stablecoin and RWA applications.

Behind these moves, Huaxing leveraged Binance’s momentum to join Web3’s core players.

On August 29, at BNB Chain’s fifth anniversary, Xu Yanqing told YZi Labs head Ella Zhang: "Since our partnership, we’ve received massive inquiries from traditional institutions. They no longer ask ‘why digital assets?’ but ‘how to properly allocate core assets like BNB representing future finance.’"

She emphasized: "Huaxing won’t just bridge Web2 and Web3; through our investment banking, asset management, and wealth management expertise, we’ll lead as Web3’s most iconic投行."

In short, Huaxing’s logic is clear:

• External: Traditional institutions seek crypto exposure with lower risk via Huaxing stock.

• Internal: Web3-Web2 fusion will spawn new financing and M&A demand, replaying the "internet M&A decade."

Huaxing wants to remain the "top投行" shaping markets—but in crypto.

The vision is grand, but reality bites.

Transformation Dilemmas
As a boutique投行 built on TMT M&A, Huaxing’s core strengths are deep internet insights and founder resources.

In traditional投行, incentives are clear: commissions, short-term业绩, quick results. Employees are "professional service providers" closing deals for fees.

For Huaxing, entering crypto means facing a harsh reality: even top traditional capitals have stumbled here.

First, the FA model is doomed.
In internet M&A’s heyday, Huaxing thrived on networks and information asymmetry: who raised funds, who sold, at what valuation—only a few投行 knew. In on-chain worlds, capital flows, governance votes, and protocol data are nearly fully transparent, trackable in real-time by anyone. Except for some Asian exchanges or asset managers needing FA help, most projects’ capital actions resemble "pooled investments," or even platforms like Hyperliquid never needing external funding.投行 pricing and facilitation advantages fade.

Thus, to earn超额 returns, Huaxing must invest directly.

"FA mainly builds connections; investing makes money," some FA practitioners explored crypto with this mindset. After making friends and investing, they successfully lost money.

Crypto primary markets are extremely perilous. Good investment requires deep understanding of crypto’s底层 logic and connections with top entrepreneurs for continuous empowerment.

But币圈 floods with short-term narrative traps: a project hitting trends might soar in months; post-narrative, market caps halve, teams lack business models, survive by selling coins, and prices keep falling. Moreover, markets now distrust altcoins, focusing funds on BTC, ETH, SOL等头部 assets. Even popular stock-token联动 models may be disproven someday.

For Huaxing, this means two-layer risks:

1. Investment vision能否穿透 narrative traps.

2. Reputation risks.

Crypto cycles change faster than traditional markets. A protocol hack or project rug pull can destroy market cap in 48 hours. If Huaxing steps on mines, it loses not just funds but hard-earned "boutique投行"口碑.

Singapore’s state fund Temasek not only lost ~$275 million in FTX but, as a state-backed investor, faced parliamentary queries, admitting "major due diligence omissions," severely damaging reputation.

From this perspective, Huaxing’s best path isn’t recreating a crypto "M&A King" but becoming a large secondary market player. Strategically allocating to core assets like BTC, ETH, BNB, plus quantitative strategies and risk hedging, could pursue steady returns.

But this road is equally treacherous.

Trading means competing with countless professional quant funds, crypto-native trading teams, and multinational market makers. Without deep technical skills, risk control systems, and on-chain data insights, traditional投行 brand and networks hardly build real advantages.

Huaxing is in an awkward position:

• FA: information advantage gone.

• VC: narrative traps everywhere.

• Secondary: lacking native genes.

This dilemma faces many traditional FA/VCs in crypto. To立足 Web3, it takes not just capital but complete cognitive restructuring.

It must answer: in this transparent, disintermediated world, what is Huaxing’s value?

Looking back from 2025, Huaxing’s Web3 transformation resembles a forced experiment. Not active choice but being cornered by environment.

20 years ago, Huaxing rose by catching China’s internet takeoff window. Then, Bao Fan challenged with sharpness, tearing old finance gaps with "internet-savvy投行."

Today’s situation differs: Web3 isn’t moving offline业务 online but rewriting financial logic entirely: decentralization, permissionlessness, community governance—these ideas shake投行’s intermediary survival foundation.

Role shifts sharpen problems. Past Huaxing was a startup, traveling light; present Huaxing is vested interest, "all-in" new tracks meaning abandonment and betrayal. For an institution written into China’s M&A history, this choice is crueler than two decades ago.

But for Huaxing, there’s no turning back.