Millions of dollars invested in the giant network of encryption funds: in order to explore the metaverse, Web3.0

**Source: **Financial Association

Reporter Xu Cihao

Image source: Generated by Unbounded AI tool

Giant Network issued an announcement last night (11th), announcing that its wholly-owned subsidiary Giant Investment signed the "Subscription Agreement" with DeFiance Liquid Venture Fund Limited ("DeFiance" for short) on May 10th. Giant Investment intends to contribute with its own funds Subscribe for shares of DeFiance with USD 1 million and become a shareholder of DeFiance.

This time is another move for Giant Network to invest in the field of cryptocurrency.

As early as 5 years ago, Giant Network invested in the cryptocurrency exchange OKCoin, but three months later, Giant Network announced that it was considering transferring this part of the equity to other companies under Shi Yuzhu's name in order to protect investment.

A person from Giant Network told the Metaverse NEWS reporter that Giant Investment, as a wholly-owned subsidiary of the company in Hong Kong, mainly aims to explore Metaverse, Web3.0, and integrate resources, and the investment amount is relatively small; In terms of regulatory compliance, the company has not received any comments from regulators.

Giant Network's million-dollar investment in encrypted investment funds

According to Giant Network’s announcement, DeFiance was established on November 24, 2022. It is an open-end fund. The initial fundraising scale is 20 million US dollars, and it will remain open until the total scale reaches 100 million US dollars. The fund is currently in the fundraising stage.

DF Capital Management Pte. Ltd., the DeFiance fund manager, was established on May 14, 2022. It mainly invests in digital assets, decentralized technologies and infrastructure in the Web3.0 field.

It is worth mentioning that, as early as November 10, 2022, when Giant Network responded to investors about Web3. The "decentralized" Internet based on the "block chain" technology; it is still in the stage of exploring application scenarios, and the company is actively paying attention to the technological development trend of Web3.0 related fields, and according to the evolution of new technologies, timely launch new product.

The reply also stated that the company has also determined the metaverse game as one of the long-term layout directions, and has formed a separate technical product team to patiently explore the development path and solidly promote product research and development.

"The Web 3.0 era will bring all-round upgrades in scenarios, models, and organizations, and it is an opportunity for the entire industry chain." Yu Jianing, executive director of the Metaverse Industry Committee of the China Mobile Communications Federation, told the Metaverse NEWS reporter that Giant Network is also I have taken a fancy to Web3.o as an important "new species" for the development of the digital economy, and I have seen the direction of future Internet upgrades.

Yu Jianing analyzed that DeFiance Capital is a Web3.0 encrypted asset investment fund that combines fundamental analysis and active investment strategies. Relatively speaking, DeFiance is currently one of the investment funds with better performance in the industry. A good choice.

However, Yu Jianing pointed out that because Web3.0 is an emerging field, there are still certain risks in investing in this field; such investors usually need to have more resources and professional knowledge for risk management.

**How to avoid legal risks? **

According to public information, DeFiance Capital announced in March this year that it had completed fundraising of tens of millions of dollars. Its investment cases include dYdX, Lido, ConsenSys, Secret Network and other currency circle projects.

What kind of risks will there be in participating in the investment of encrypted investment institutions as a listed company?

A reporter from Metaverse NEWS called Giant Network as an investor. Giant Network stated that there is no way to directly reply that there is no risk or there is risk; Giant Investment, as a wholly-owned subsidiary of Giant Network in Hong Kong, mainly invests in the exploration of Metaverse, Web3.0, and resource integration, and the investment amount is relatively small ; As for compliance, the company has not received regulatory advice.

According to Zhang Feng, a partner of Wanshang Tianqin Law Firm, as a listed company investing in encryption projects, there are two main considerations: one is to operate in accordance with laws and regulations, such as using legal sources and legal purposes through its subsidiaries funds to invest in legal targets; second, to disclose information in accordance with laws and regulations.

He further analyzed that in some regions such as Hong Kong, China, a regulatory system for cryptocurrencies has initially formed, including identifying the legal nature of cryptocurrencies from the perspectives of securities, functions, and currencies, and their issuance, use, and transactions have already been established. There are corresponding regulatory requirements, and there are also some relevant regulatory requirements for corresponding ecosystems such as cryptocurrency investment institutions, trading platforms, and application scenarios.

"Therefore, on the basis of complying with legal sources of funds, anti-money laundering and anti-terrorist financing, and complying with market regulatory requirements to protect the rights and interests of enterprises, users and investors, there is a way of compliant operation." Zhang Feng said, from the published information Look, Giant Network is invested by its wholly-owned subsidiary. The US$1 million should be the subsidiary’s legal own funds, and investing in encryption institutions in a compliant manner meets the requirements.

According to the industry and commerce information of Tianyancha, Giant Network also completed tens of millions of US dollars of investment in the C round of OKCoin, a trading currency exchange, in December 2017.

However, just three months later, in March 2018, Giant Network issued an announcement saying that in order to reduce the impact of uncertainty and from the perspective of protecting the interests of investors in listed companies, Giant Network and its wholly-owned subsidiary Giant Hong Kong planned to invest in Shi Yuzhu's The company transferred its 14% stake in OKCoin; correspondingly, Giant Network transferred its 14% stake in OKCoin's domestic related VIE company Beijing Okai Lianchuang Network Technology Co., Ltd. The consideration for this transaction is a total of 28.5 million US dollars.

Regarding the transfer of the OKCoin shares previously held by Giant Network.

Lawyer Zhang Feng analyzed to the reporter of Metaverse NEWS that judging from the situation at that time, the main body of OKCoin was still in China, and it itself faced the risk of domestic policy supervision. As a giant network, as a listed company, it also faced the risk of compliance.