Move-to-earn poster child STEPN revealed a surprise plan to open an office in Hong Kong on Monday, bucking the trend of companies exiting the city due to strict Covid rules and a difficult regulatory environment.
Speaking with the South China Morning Post, co-founder Jerry Huang confirmed the company would move its regional headquarters to government-owned Cyberport, a tech hub which is home to more than 1,800 start-ups and companies.
Huang said the move was prompted by conversations with former Cyberport chairman George Lam about creating a web3 startup environment in Hong Kong. STEPN, which allows players to earn rewards for exercising through the purchase of sneaker NFTs, is currently based in Adelaide, Australia.
The company hasn't yet given a date for the move, but it comes as other financial and tech firms leave Hong Kong for fairer shores.
Among them, FTX moved its headquarters to The Bahamas last year. While the move was attributed to regulatory uncertainty, FTX CEO and founder Sam Bankman-Fried also tweeted his frustration at strict quarantine procedures.
"Who would have thought two years ago that a significant consideration for where to live would be 'it's actually legal to enter and leave the country,'" he said.
Former PwC global crypto leader Henri Arslanian also opted for the Cayman Islands and Dubai as the bases for his new crypto asset management firm over Hong Kong due to regulatory approval times and travel restrictions. That's despite saying he felt Hong Kong would have been its "natural home."
Companies have expressed concern about the influence Beijing has over Hong Kong, particularly following the introduction of the National Security Law in June 2020. Beijing’s antagonistic stance on non-government crypto projects is well known, and many crypto activities remain banned in Mainland China — albeit with plenty of people finding workarounds.
STEPN itself enjoyed a following in China until it turned off its GPS services there in July, causing the app’s token, GST, to drop 10% following the announcement. It is unclear to what extent STEPN's hand was forced by authorities.
Nevertheless, STEPN will join the remaining Hong Kong holdouts, including Animoca Brands, which is also based in Cyberport.
Disclaimer: The former CEO and majority shareholder of The Block has disclosed a series of loans from former FTX and Alameda founder Sam Bankman-Fried.
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